Married Filing Separately with Form 8958 in Community Property State (TX)

Forum|Forum|6 years ago
May 18, 2020
4 replies
19 views

Spouses are filing separately due to an income-driven student loan. Each spouse has a W-2. I understand I have to include Form 8958 because they are Texas residents, and this form will reconcile the amounts reported per W-2 to the 1040s. My question is more about the mechanics of doing this in ProSeries. What is the proper method to allocate the W-2 amounts? Should I manually adjust the amounts reported in box 1 and box 2 only (and keep all other amounts in box 3, box 5, etc. as reported per W-2)? Thank you in advance for any guidance.

ProSeries Professional

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M

milkshaken

Level 3

I'm having the same issue with a Married Filing Separate return in CA. I think that the correct way to do it is to modify the amounts in box 1 and box 2 to include half of wages and withholdings, but when I do this I get an error message on the spouses W2 because their filing isn't MFJ. Their preparer last year included the community property adjustment as "Other Income" on Schedule 1 but I really don't think that this is correct.

F

fiscalsolutions

Level 2

I practice in TX and use Proseries. Proseries is completely useless when it comes to MFS returns in a community property state. You have to override all of the amounty on the 8958 and every other schedule. You might as well do the return without software

In addition you cannot e-file a MFS return because it has "errors" from all of the overriding. Nice.

I will not be buying this software again. In a community property state, it's worthless for MFS returns

M

milkshaken

Level 3

Thanks for the reply! It's super disappointing to know that proseries can't handle MSF in a community property state. I have at least two that I'll need to file this year.

F

fiscalsolutions

Level 2

Yes it is disappointing. I mean, it has the schedules that you need, but by the time you override the fields because the community property schedule doesn't automatically populate on other schedules, like I said, you might as well have done it without a computer. Plus, you can't e-file it because all the overrides are counted as "errors".

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