Tax Question

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Not able to find definitive answers for this one:

Background:
- I live and work in Texas (no state tax)
- Wife works in Oklahoma (student earning stipend for research work, has state tax)

Question:
- Can I file joint status for both federal and Oklahoma state tax but report only her income in OK state tax filing or should I have to report combined earnings in it?

Appreciate all inputs.

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nars said:   Not able to find definitive answers for this one:

Background:
- I live and work in Texas (no state tax)
- Wife works in Oklahoma (student earning stipend for research work, has state tax)

Question:
- Can I file joint status for both federal and Oklahoma state tax but report only her income in OK state tax filing or should I have to report combined earnings in it?

Appreciate all inputs.

Better (more descriptive) title please.

Read the OK state tax form instructions. I dont know specifically about OK but typically you will have to report all income, with you being a non-resident. The form should work out the calculations (see form 574 in particular).

Sorry about the title from your direction to the 574 form I read the note as below in it and understand it is possible for my wife to file OK tax in married filing separate status and just report her wages and I do nothing since I don't have wages from OK and thus don't have a requirement to file.

Please correct me if I am not understanding this correctly.

An Oklahoma resident, who files a joint Federal return with a nonresident civilian (non-military) spouse, may
elect to file a married filing separate return in Oklahoma using Form 511, enclosing Form 574. If this election
is not made, a joint return must be filed using Form 511 and reporting all of the income of both taxpayers as if
both were residents.
If the election is made to file separate returns and the nonresident civilian spouse has an Oklahoma filing requirement,
the nonresident should file a Form 511NR, enclosing Form 574.

nars said:   Sorry about the title from your direction to the 574 form I read the note as below in it and understand it is possible for my wife to file OK tax in married filing separate status and just report her wages and I do nothing since I don't have wages from OK and thus don't have a requirement to file.

Please correct me if I am not understanding this correctly.

An Oklahoma resident, who files a joint Federal return with a nonresident civilian (non-military) spouse, may
elect to file a married filing separate return in Oklahoma using Form 511, enclosing Form 574. If this election
is not made, a joint return must be filed using Form 511 and reporting all of the income of both taxpayers as if
both were residents.
If the election is made to file separate returns and the nonresident civilian spouse has an Oklahoma filing requirement,
the nonresident should file a Form 511NR, enclosing Form 574.

I dont know anything more than what a simple G00gle search brought up (link to the form above) to comment. That single paragraph seems to indicate that MFS for resident spouse for OK and MFJ for federal would be fine. However, it would be a good idea to read the complete instructions of all the relevant forms so that you are reading things in context.

If both you and your wife are TX residents, i.e. neither of you is OK resident, you must use the same filing status as your Federal return. Thus, file MFJ OK nonresident return form 511NR. You will have to pay tax on OK sourced income as follows: OK tax on 100% of income times share of income from Oklahoma sources. For example you have $100 of Fed taxable income and OK tax on it is $6 (per tax table), but only $33 of Fed income is from OK sourced stipend. Your OK tax will be $6 x 33/100 = $2.

You may get better OK result if you choose to file Federal return with MFS status, however you will likely pay more Federal tax.

Matr0skin said:   If both you and your wife are TX residents, i.e. neither of you is OK resident, you must use the same filing status as your Federal return.
I suspect wife is an OK resident. Many universities (at least state universities) require residency to get assistantship, which is probably what she gets.
ETA: Care to clarify this OP?

Yes wife is OK resident.
Just to clarify wife has no income source outside of OK and I have no income source outside of Texas.

Per OK 511 instructions page 7 Spouse should file OK Form 511 with MFS status, OP has no OK filing requirement.

The filing status for Oklahoma purposes is the same as
on the Federal income tax return, with one exception.
This exception applies to married taxpayers who file a
joint federal return where one spouse is an Oklahoma
resident (either civilian or military), and the other is a
nonresident civilian (non-military). In this case the taxpayer
must either:
• File as Oklahoma married filing separate. The
Oklahoma resident, filing a joint Federal return with a
nonresident civilian spouse, may file an Oklahoma return
as married filing separate. The resident will file on Form
511 using the married filing separate rates and reporting
only his/her income and deductions. If the nonresident
civilian has an Oklahoma filing requirement, he/she will
file on Form 511NR, using married filing separate rates
and reporting his/her income and deductions. Form 574
“Allocation of Income and Deductions” must be filed with
the return(s). You can obtain this form from our website
at www.tax.ok.gov.



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