Prepare Separate Profit and Loss Statement on Separate Businesses of Husband and Wife

August 5, 1958 BIR RULING NO. 425-58 Mr. Conrado E. Sevilla, Jr. Certified Public Accountant R-30y Roxas-Skawinski Bldg. R. Hidalgo, Manila S i r : This has reference to your letter dated June 30, 1958 requesting ruling on the following queries, to wit: "(1) Supposing both husband and wife have separate businesses, in their consolidated return, may each one prepare a separate Profit and Loss Statement? "(2) Supposing both husband and wife derive income from teaching, (a) may each one itemize and deduct separately their deductible expenses? (b) may each one claim the standard deduction separately? (c) May the husband itemize his expenses and the wife claim the standard deduction? "(3) Supposing the husband has a business and the wife derives her income from teaching, (a) may they each itemize their expenses? (b) may the husband itemize his expenses and the wife claim the standard deduction?" In reply thereto, I have the honor to inform you as follows: As regards query No. 1, if both husband and wife have separate businesses, each one of the spouses can prepare separate profit and loss statement and attach said statements in their consolidated return. Anent query No. 2, if both husband and wife derive their income from teaching, both can avail of the itemized deduction in their consolidated return. If they choose the optional standard deduction, they can claim only one optional standard deduction in an amount of P1,000.00 or 10% of their consolidated gross income, whichever is the lesser pursuant to Section 30(k) of the same Code. They can claim only one deduction, either the itemized deduction or the optional standard deduction. With respect to query No. 3, if the husband has a business and his wife derived income from salary, both can claim itemized deduction in their consolidated return. But in no case can one of the spouses claim the itemized deduction and the other optional standard deduction. cdta Very truly yours, (SGD.) MELECIO R. DOMINGO Acting Commissioner of Internal Revenue