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Filing Status Overview

Chris Test December 21, 2020

All taxpayers have one of five filing statuses that impacts a large number of items on the tax return, including filing requirements, the standard deduction, and eligibility for certain credits. Generally, our tax software will automatically make these determinations for us, but it is important to determine the taxpayer filing status correctly.

Determine if a taxpayer can claim a dependent, then check their filing status.

An individual’s filing status is largely dependent on their marital status and whether or not they have a dependent; it is important to see if a taxpayer is eligible to claim a dependent before attempting to determine their filing status!

The Five Filing Statuses

  1. Married Filing Jointly
  2. Married Filing Separately
  3. Qualifying Widower (with a dependent child)
  4. Head of Household
  5. Single

Single

A taxpayer is generally eligible for the Single filing status if, on the last day of the tax year, they are

Not married, legally separated or divorced or windowed, and if they do not have any dependents they are eligible to claim.

Married Filing Jointly

Individuals may qualify as Married Filing Jointly if, on the last day of the tax year:

  • The couple lived together as a married couple OR
  • They lived apart but were not legally separated/divorced
  • One spouse died during the year, and the surviving spouse did not remarry before the end of the year.

Married Filing Separately

Taxpayers who are legally married may also file separately. This means that both taxpayers in question will file separate returns with the IRS.

MFS Considerations

Taxpayers with the Married Filing Separately status are not eligible to claim several tax credits, and this may cause them to lose several thousand dollars that they could be receiving a refund.

Many taxpayers view filing separately as simpler and may not know that they are missing out on tax credits. Taxpayers may also believe they need to file as MFS to avoid their spouse’s debts or prior tax obligations. There are recourses in the tax code for these taxpayers, and it may be beneficial for them to file jointly. If a taxpayer chooses to file separately, we should encourage them to consider filing jointly but respect their wishes to file separately if they insist.

Alternatively, some taxpayers may have been separated from their partners for many years, but have not legally separated from their partners. . If the taxpayer is still legally married, they should file as MFJ or MFS with their spouse, or Head of Household if they have an eligible dependent for Married individuals..

MFS Documentation

Taxpayers who wish to file separately will need to include the legal name and Social Security number of their spouse on the return. If they do not have that information, the return will need to be mailed to the IRS.

Head of Household

There are two possible ways a taxpayer can be considered Head of Household. Be sure to review the rules for each.
Head of Household: Married Taxpayers–All of the below must occur for a married taxpayer to claim Head of Household filing status. Otherwise, they must file as MFJ or MFS.

  • MUST have lived apart from their spouse ALL of the last 6 months of the year
    • If they lived with their spouse anytime after July of the tax year, they must file as MFJ or MFS
  • MUST have paid more than ½ the cost of keeping up their own home for more than half the year
  • Their home must be the main home for the taxpayer’s Child, Stepchild, or Foster Child. No other relationships will meet this test.
  • You must claim the child as a dependent on the tax return
Head of Household: Un-Married Taxpayers
  • Must have paid more than ½ the cost of keeping up their own home for more than ½ the year
  • A “qualifying person,” lived with you in your home for more than ½ the year
    • Note a “qualifying person,” is different than a dependent
      • Most dependents will qualify as a qualifying person for Head of Household Filing Status, but not all
      • Alternatively, and in rare circumstances, a child may not be someone’s dependent, but will still qualify for Head of Household Filing Status
    • Always use the chart on B-10 of the Pub 4012 to determine if the taxpayer has a qualifying person living in their home

Qualifying Widower (with a dependent child)

Qualifying Widower is the least common filing status. Taxpayer whose spouse passed away in the prior two tax years and have a dependent child may qualify for this filing status. If the taxpayer does not have a dependent child, they will not qualify for this filing status.

  • Had a spouse that dies during the prior two tax years (2018 & 2019) and did not remarry before the end of 2019.
  • In the year of death, the taxpayer was entitled to file a joint return with their spouse
  • The taxpayer paid more than ½ the costs of keeping up their own home during the year.
  • The taxpayer’s son or daughter (but NOT a foster child) or stepchild lived in their home all year and was their dependent OR Would qualify as your dependent except that he or she does not meet the gross income test, does not meet the joint return test, or except that you may be claimed as a dependent by another taxpayer.

Filing Status Decision Tree

ALWAYS Use the Pub 4012 to help you determine a taxpayer’s filing status! I recommend using the decision tree found on B-8. It will easily guide you through the complex requirements for some filing statuses,

Filing Status Examples