Form 8958 must be completed if the taxpayer:
- is married filing separately
- resides in a community property state
OR
- is filing as single or as head of household
- is in a same-sex Registered Domestic Partnership (RDP)
- resides in California, Nevada or Washington
The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.
Who is considered married for federal tax purposes?
In accordance with IRS Revenue Ruling 2013-17, for federal tax purposes, individuals of the same sex are considered married if they were lawfully married in a state (or foreign country) whose laws authorize the marriage of two individuals of the same sex. The individuals are considered married for federal tax purposes even if the state (or foreign country) in which they now live does not recognize same-sex marriage.
Individuals who have entered into a Registered Domestic Partnership (RDP) that is not considered a marriage under state (or foreign) law are not considered married for federal tax purposes.
If the tax return filing status is Married Filing Separately and the taxpayer lives in a community property state the 8958 will generate and require entries for the return to be complete.
- See IRS Publication 555 Community Property for information on what allocations need to be done to the tax return.
- Open the 1040 and supporting forms to complete the allocations needed for taxpayer and spouse before entering any information on the 8958.
- Some allocations may require overrides to get ProSeries to calculate the 1040 correctly.
- Open the 8958.
- Check the Yes box for Are allocated communtiy property amoutns reported on this return?
- The 8958 will pull the amounts reported on the tax return and displays them in column B for the Taxpayer.
- Manually allocate all items, and enter any amounts allocated to the other spouse or RDP in column C.
- Your entries on this form will have no impact on either the federal or state return.
