Joint Return = Spouses Treated as One?

Technical topics regarding tax preparation.
#1
Chay  
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I know that treatment of both spouses as one is provided for explicitly with respect to certain deductions.

I also know they aren't always treated this way. For example, I know that when one spouse pays rent to the other for property they own jointly, the payor can deduct half of the rents paid. I also know that attribution of net self-employment income to one spouse or another is important.

What I don't know is which way to lean when things aren't so clear. When I read "the taxpayer" in some Code section or another, should I assume the provision applies separately to each party to a joint return absent evidence to the contrary? Or should I assume that "the taxpayer" is a fictional entity consisting of both spouses, unless context clearly indicates otherwise?

In asking this question, I am contemplating payments and other transactions that one spouse or another enters into. For example, health insurance premiums. In the case of the SEHI deduction, does it matter who pays them?
 

#2
Nilodop  
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It's defined in the Code as
(14) Taxpayer
The term “taxpayer” means any person subject to any internal revenue tax.


Then person is defined as
(1) Person
The term “person” shall be construed to mean and include an individual, a trust, estate,partnership, association, company or corporation.


But that does not answer your questions. Taxpayer surely means each individual in the case of section 121. And in 1041. There are differing treatments such as a qualifying joint venture and others. And innocent spouse. And gifts.
 

#3
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If we accept the definition of "person" as being construed to mean and include certain things, do we thereby have any basis to say that other things might be *excluded* from that definition?
 

#4
Nilodop  
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No way!
(c) Includes and including
The terms “includes” and “including” when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined.
. Is a spouse a thing?
 

#5
LW25  
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Nilodop wrote:No way!
(c) Includes and including
The terms “includes” and “including” when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined.
. Is a spouse a thing?


Maybe it depends in part on how you define "thing" and maybe it depends in part on whether you consider the definition to be referring to a symbol (that is, to a word itself) or (alternatively) to the subject for which the symbol is intended to stand.

Recall the painting of a smoker's pipe by Magritte, with the words "Ceci n'est pas une pipe" ("this is not a pipe"). The "pipe" shown in the painting is not a pipe. It's just a picture of a pipe.

In a written sentence, the letters that spell out "t-h-i-n-g" or "s-p-o-u-s-e" are not the ultimate subjects themselves, but are only symbols (which we call "words") for the ultimate subjects.

In section 7701(c), the reference to "thing" might be just a reference to the word "spouse" and not to the human being who is described as a spouse.

Or, maybe not.

:?
Last edited by LW25 on 24-Aug-2019 12:39pm, edited 1 time in total.
 

#6
makbo  
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Chay wrote:When I read "the taxpayer" in some Code section or another, should I assume the provision applies separately to each party to a joint return absent evidence to the contrary?

That seems the most sensible approach, to me. But rather than phrase it as "treatment of two taxpayers (spouses) as one", I think it is more accurate to speak of "treatment of taxpayer according to filing status and co-residency status with spouse". For example, taxation of Soc. Security benefits for married taxpayers depends on whether they file joint or separate, and in the latter case, whether they live together or apart. Saying they are treated simply as one or two taxpayers is an over-simplification.

Chay wrote:In the case of the SEHI deduction, does it matter who pays them?

No. See Pub 17, "If you were self-employed and had a net profit for the year, you may be able to deduct, as an adjustment to income, amounts paid for medical and qualified long-term care insurance on behalf of yourself,". Also, "You can include medical expenses you paid for your spouse. To include these expenses, you must have been married either at the time your spouse received the medical services or at the time you paid the medical expenses.
 

#7
makbo  
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LW25 wrote:In a written sentence, the letters that spell out "t-h-i-n-g" or "s-p-o-u-s-e" are not the ultimate subjects themselves, but are only symbols (which we call "words") for the ultimate subjects.

Is that like the difference between numerals and numbers?
 

#8
LW25  
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makbo wrote:
LW25 wrote:In a written sentence, the letters that spell out "t-h-i-n-g" or "s-p-o-u-s-e" are not the ultimate subjects themselves, but are only symbols (which we call "words") for the ultimate subjects.

Is that like the difference between numerals and numbers?


Ah, er, um, well, maybe, yeah, sorta, I think.

:shock:
 

#9
makbo  
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By coincidence, I found this interesting discussion in a news update from TheTaxBook, summarizing Bruce H. Voss and C.J. Sophy, 9th Cir., August 7, 2015 case.

TheTaxBook wrote:"Congress, knowing that joint filers are treated as a single taxpayer and that separate filers are treated as two separate taxpayers, wants to ensure that the separately filing spouses do not get double the benefit that jointly filing couples get. [...]

If Congress wants to go further and ensure that two or more unmarried taxpayers are treated as a single taxpayer for purposes of a particular deduction or credit, it can do that too. And Congress knows how to do that. IRC section 36 is a perfect example. Under the first time home-buyer credit, the $8,000 limit must be allocated between two individuals who are not married who purchase a principal residence as co-owners. As this code section makes clear, Congress knows how to treat a group of unmarried taxpayers as a single taxpayer for purposes of a particular tax benefit. Congress could have likewise done this for the home mortgage debt limit provisions by writing similar language as used in IRC section 36 into the provisions under IRC section 163. But tellingly, they did not."


The only thing I would add, is that some Congresses are smarter than others.

[edit: I guess I would add more: isn't the dependent deduction/credit under a multiple support agreement another easy example of Congress knowing how to treat a group of unmarried taxpayers as a single taxpayer?]
 


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