Community Property

[Strongsilence-CPA]

Married couple, over 300K filing jointly. They want to file separately to get under 150K so that the spouse qualifies for the EV credit. He wants 100% of his book royalties to go to him to keep the spouse AGI under 150K.  The book was researched, and his ideas occurred before marriage but the book was published after marriage.

I don't know the rules, but it seems to me that this is community property.

[Strongsilence-CPA]

I don't see a box for Joint for pensions.

a minute later, I found my answer:

Lacerte will not split pension income on the MFJ/MFS income worksheet for community property states. It will keep the designation either taxpayer or spouse. To split it, a manual entry will be required to show the split by entering two items (one for the taxpayer and one for the spouse).

[Strongsilence-CPA]

They will get a nice tax credit of 7,500 but about $1,500 or so will be their tax prep bill. These MFS returns more time consuming than Mike Tyson in a spelling bee!

And their Medicare costs will likely increase. 

I'd like LC to have a Joint box so that I can easily split pensions.  

[jharvey]

Pensions don't automatically split 50/50 on a MFS return for community property states because they are sometimes considered separate property. See IRS Pub 555:

Pensions are classified as community or separate depending on the period of participation in the pension during the registered domestic partnership and whether domiciled in a community property state or in a noncommunity property state during the total period of participation in the pension. Distributions from IRAs are deemed as separate property.

[Strongsilence-CPA]

Thank you @jharvey 

What does "period of participation" mean?  It is a vague term, and I haven't found an example.  I think that if the earnings underlying the pension arise while the taxpayers are married AND living in a community property state, then the pension is community.

Pensions don't automatically split 50/50 on an MFS return for community property states because they are sometimes considered separate property.

I would like LC to have a joint box for these situations when they are community property.