Should we file separately? If i were single my income would allow me to get the $4000 Used Clean Vehicle Tax Credit but with my spouses higher income we do not qualify.

If you already filed a joint return you are not permitted to amend to file married filing separately after the April 15 deadline.   If you have not yet filed at all, you can consider both options--married filing jointly or married filing separately.   

When you file married filing separately, you lose some other credits and pay a higher tax rate.  So you would need to prepare your returns both ways to see if getting that $4000 credit is worth the other disadvantages of filing separate returns.

It is not easy to compare MFJ to MFS using online TT but you can do it.  Since you only get one return for each account and user ID, you have to use 3 accounts and user ID’s—one for MFJ and two for each of the MFS returns.  Compare, choose, and file—and pay—accordingly.

It is much easier to do this comparison using the desktop version of TT installed from a CD or downloaded to your own computer.  You pay once for the software and you can prepare multiple returns easily, and it has a “what if” feature that allows comparisons.

WHAT IF…?

If you are using Desktop software:

• With your return open, click Forms in the upper-right-hand corner
• Click Open Form
• In the Search area, type the word what. You should see the What If Worksheet listed, click to open it.

If you were legally married at the end of 2024 your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will get the married filing jointly standard deduction of $29,200 (+ $1550 for each spouse 65 or older)  for 2024. You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return.

 Some of the special rules for filing separately include: you cannot get earned income credit, education credits, adoption credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. In many cases you will not be able to take the child and dependent care credit. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI)

 If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice since with online, you get one return per fee.

https://turbotax.intuit.com/tax-tips/marriage/should-you-and-your-spouse-file-taxes-jointly-or-separately/L7gyjnqyM?srsltid=AfmBOopGqCNexowW0pYgvsf7ycIkrx4VjO_63UXv6vSnfu3UEGQiKQTh

https://ttlc.intuit.com/turbotax-support/en-us/help-article/income/getting-married-mean-taxes/L2RgmagpE_US_en_US?uid=m69on7t0

https://ttlc.intuit.com/turbotax-support/en-us/help-article/taxation/married-filing-separately-community-property/L11CeLUMs_US_en_US?uid=m69ousyh

The used vehicle credit is not specifically disallowed for married filing separately.

https://www.irs.gov/credits-deductions/used-clean-vehicle-credit

However, you should very carefully estimate your taxes both ways before you file.  There are other significant deductions and credits that are reduced or disallowed under the married filing separately status, and you need to do the math to make sure those costs don't offset the benefits.  Also, remember the most significant issue with MFS--if one spouse itemizes their deductions, both spouses must itemize, even if there are not enough itemized deductions to go around.  It is not allowed to load all the itemized deductions onto one spouse so the other takes the standard.