Bonnie and Jake are married with no dependents and live in Montana (not a community property state). Because Jake has large medical expenses, they seek your advice about filing separately to save taxes. Their income and expenses for 2012 are as follows:
Bonnie’s salary |
$ 42,500 |
Jake’s salary |
26,000 |
Interest income (joint) |
1,500 |
Rental loss from actively managed rental property |
(23,000) |
Jake’s unreimbursed medical expenses |
8,500 |
All other itemized deductions:* |
|
Bonnie |
9,000 |
Jake |
3,400 |
Determine whether Bonnie and Jake should file jointly or separately for 2012.