If both you and your spouse have income, you can file your Montana tax returns separately, even if you filed your federal income tax return jointly. But, if you and your spouse file separately, you will each need to report your own adjusted gross income. You cannot arbitrarily assign income between the two of you.
Your income from salaries, wages, bonuses, commissions and other income from providing personal services either as an employee or as an independent contractor should be reported by the spouse who earned it. Any other income that you earned from rents, royalties, dividends, etc., from property that is owned by only one spouse, has to be reported by that spouse. If any income is earned from property that is jointly owned by both spouses, that income should be split equally, unless you and your spouse can show a different proportional ownership. When you file separately, both spouses must either claim the standard deduction or itemize their deductions. You cannot file separately on the same form when one spouse is a resident and the other spouse is a nonresident. In this case, you should use either filing status 3b or 3c. When you file separately on the same form, you should report your income and deductions for one spouse in column A and the other spouse in column B.
Although submitted on the same form, married taxpayers electing to file using this status are submitting two tax returns. If both taxpayers are entitled to refunds, two separate checks or direct deposits will be issued. In the event both spouses owe additional tax, penalties or interest, we will mail separate Statements of Account. However, if you are entitled to a refund and your spouse owes, and you file separate returns on the same form, we treat your election to file separately on the same form as your direction to us to apply your refund to the amount owed by your spouse. If you do not want your refund to be offset against any tax due from your spouse, you and your spouse must file on separate forms. If we discover a math or other computational error when processing the form, we will adjust it to correct the error and this may result in our applying one spouse’s refund to the other spouse’s increased tax. If you do not wish for this to occur, you will need to file your own separate return.
REMINDER! Beginning with the 2013 tax year, Montana law now permits department employees to discuss all information on the form with either spouse when the couple elects to file with this status. The department may also discuss any subsequent adjustments with either spouse. If you do not want to permit this, you and your spouse should file on separate forms. However, the new law does not permit you to make decisions for your spouse or to receive information about an amount your spouse may owe.