KY MFS

[Margaret CPA in OH]

Clients were married October 2015.  Husband moved to OH from KY in December. It seems for KY they are allowed to file separate even though federal is joint (as of now). OH requires same as federal. ATX provides comparison with federal and OH but now I need to determine KY liability.

It seems that wife can/must file KY separately even without any KY income or deductions and as a full-year non-resident should owe no KY tax although husband would. Is this a correct assumption?  I think it would benefit them combined with OH and federal MFS.

Thanks!

[Jack from Ohio]

For what reason would they want to file separately?  Am I missing something?

[Margaret CPA in OH]

The tax is lower based on calculations of percentage of joint deductions.  It's only $79 but not nothing.  I was just unable to see definitively whether KY filing is required to follow federal as does OH.

[Jack from Ohio]

So $79 covers your cost for the second return and all the research involved?  Still not getting it...

[Roberts]

7 minutes ago, Jack from Ohio said:

So $79 covers your cost for the second return and all the research involved?  Still not getting it...

It would most certainly not cover mine.

Seems several states including KY allow you to file federal MFJ and state MFS.

[Margaret CPA in OH]

Of course $79 does not cover the cost.  You didn't ask and I didn't write the savings for combined federal and Ohio tax.  Jack, you know quite well that MFS for OH often is a savings but filers must also file separately for federal purposes so the savings is combined, not independent.

I must have been clear as mud that I was asking specifically and only about the KY requirement.  I already know that answer for federal and OH.  I just cannot find a definitive answer as to the requirement - or not - to file KY jointly or separately depending on the federal filing status.

Sorry I asked and wasted your collective times.

[Jack from Ohio]

1 hour ago, Margaret CPA in OH said:

Of course $79 does not cover the cost.  You didn't ask and I didn't write the savings for combined federal and Ohio tax.  Jack, you know quite well that MFS for OH often is a savings but filers must also file separately for federal purposes so the savings is combined, not independent.

I must have been clear as mud that I was asking specifically and only about the KY requirement.  I already know that answer for federal and OH.  I just cannot find a definitive answer as to the requirement - or not - to file KY jointly or separately depending on the federal filing status.

Sorry I asked and wasted your collective times.

http://revenue.ky.gov/NR/rdonlyres/5AA641BB-AF6D-4BA5-99D9-29A03C098A0E/0/2015740PFINAL.pdf

Pages 8 & 9.

[Margaret CPA in OH]

Thank you.  I did not find that.

[Margaret CPA in OH]

And I responded too soon.  The link was for Form 740 which provides for 4 options for filing status.  Clients are filing 740NP, part year which provides only 3 options.  On rereading, again, those instructions, It appears to say that spouses may file jointly or separately regardless of federal filing status but, in my reading, it is completely optional.  The question in my original post stands and I was and am looking for agreement that my interpretation is correct.  Sort of like a comfort letter because it seems a bit strange to be able to choose status so freely.

[gfizer]

Kentucky does not require that the filing status follow the federal status.  Most of the time taxpayers who file jointly for federal purposes have a better outcome on the Kentucky return using  married filing separately on combined return.

[Margaret CPA in OH]

9 minutes ago, gfizer said:

Kentucky does not require that the filing status follow the federal status.  Most of the time taxpayers who file jointly for federal purposes have a better outcome on the Kentucky return using  married filing separately on combined return.

Thanks, that what I have discovered now also discovering that the options for full year and part year residents are not identical.  My clients are shaking their heads thinking that they would file joint federal, husband single KY and wife single OH.  Not even close!  Now I have to keep track of which return is which with which adjustments to minimize total liability and not miss anything.  Fun times.  And the husband was trying to do this on Turbo Tax.  At least they are higher income so I will bill accordingly. 

Thanks again to all for working through this with me.