IRS Publication 555

A A A

DEFINITION

A document published by the Internal Revenue Service (IRS) that provides information to taxpayers who are married, live in a state supporting community property laws and are filing separate tax returns. Income and property is considered community if it is purchased or owned while the couple is married. All else is considered separate. Couples filing separately report half of their joint income and all of their separate income.



INVESTOPEDIA EXPLAINS

Not all states treat community property the same way. IRS Publication 555 only addresses Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. If the tax payer's primary residence is in one of these states, or if residency has been established by voting or by paying state income tax, then community property rules are likely to apply.


Married taxpayers will typically have a lower tax obligation if a joint return is filed rather than an individual return, but this is not always the case.




RELATED TERMS
  1. IRS Publication 504

    A document published by the Internal Revenue Service that provides tax guidelines ...
  2. IRS Publication 505

    A document published by the Internal Revenue Service that outlines the process ...
  3. Community Property

    A U.S. state-level legal distinction of a married individual's assets. Property ...
  4. Community Income

    Income earned by taxpayers who live in community property states. Community ...
  5. Married Filing Separately

    A filing status for married couples who choose to record their respective incomes, ...
  6. Married Filing Jointly

    A filing status for married couples that have wed before the end of the tax ...
  7. Marital Property

    A U.S. state-level legal distinction of a married individual's assets. Property ...
  8. Eurasian Economic Union (EEU)

    An economic union created in 2014 by a treaty signed by Russia, Kazakhstan and ...
  9. Proof of Charitable Contributions ...

    Substantiation required by the Internal Revenue Service for a taxpayer to claim ...
  10. Corporate Inversion

    Re-incorporating a company overseas in order to reduce the tax burden on income ...
comments powered by Disqus
Hot Definitions
  1. Cash and Carry Transaction

    A type of transaction in the futures market in which the cash or spot price of a commodity is below the futures contract price. Cash and carry transactions are considered arbitrage transactions.
  2. Amplitude

    The difference in price from the midpoint of a trough to the midpoint of a peak of a security. Amplitude is positive when calculating a bullish retracement (when calculating from trough to peak) and negative when calculating a bearish retracement (when calculating from peak to trough).
  3. Ascending Triangle

    A bullish chart pattern used in technical analysis that is easily recognizable by the distinct shape created by two trendlines. In an ascending triangle, one trendline is drawn horizontally at a level that has historically prevented the price from heading higher, while the second trendline connects a series of increasing troughs.
  4. National Best Bid and Offer - NBBO

    A term applying to the SEC requirement that brokers must guarantee customers the best available ask price when they buy securities and the best available bid price when they sell securities.
  5. Maintenance Margin

    The minimum amount of equity that must be maintained in a margin account. In the context of the NYSE and FINRA, after an investor has bought securities on margin, the minimum required level of margin is 25% of the total market value of the securities in the margin account.
  6. Leased Bank Guarantee

    A bank guarantee that is leased to a third party for a specific fee. The issuing bank will conduct due diligence on the creditworthiness of the customer looking to secure a bank guarantee, then lease a guarantee to that customer for a set amount of money and over a set period of time, typically less than two years.
Trading Center