There are five different filing statuses which you can use when completing your tax return. Each status qualifies you for different deductions and credits, so choosing the correct one is extremely important.
Taxpayers who are unmarried, or considered unmarried for the entirety of the tax year are eligible to file under the single status. If you have dependents you can claim, however, it may be more beneficial to file as Head of Household, if eligible, as your savings will likely be greater.
If you are legally married you can file a tax return with your spouse. Generally, a joint return will save you taxes. Remember that filing jointly with your spouse makes you both responsible for your taxes, including any penalties or interest you may owe.
Married taxpayers can opt to file separately from their spouse, if both parties agree. Separate returns generally have a higher tax rate, but you get to keep your income separate from your spouse’s. Additionally, you claim your own credits, deductions and exemptions.
Head of Household
This status offers taxpayers a lower taxation rate than if they filed single or separate married returns. There are certain rules to determine who is eligible to file as head of household:
- You are single or unmarried
- You paid over 50% of the expenses related to maintaining a home
- You have a qualifying child or relative who resided in your home for over half the year. Your parent can qualify as a relative, regardless of whether or not they live with you, as long as you are able to claim an exemption for them and pay for greater than 50% of their household expenses
Married taxpayers are able to file HoH if:
- You file separately from your spouse
- You are responsible for more than half of the home’s expenses
- Your spouse didn’t live in the same house as you for the final six months of the tax year
- The home you maintain is the principal residence of a qualifying child or relative
- You are able to claim an exemption for another person or child
Additionally, you may be able to file HoH if your spouse was a non-resident alien at any point during the year, although the spouse isn’t a qualifying person. Therefore, you have to meet all the other requirements in order to use this status.
If your spouse passed away during the year you can still file jointly. During the next two years, as long as you meet all the other requirements, you can file using Qualifying Widow(er) status.
- Not have remarried since your spouse died
- You were eligible to file a joint return with your spouse the year they passed
- You pay more than 50% of the expenses relating to maintaining a home
- Your home is the principal residence for a qualifying child for whom you can claim an exemption for