Tax Time: What’s Your Filing Status?

One of the most basic items you need to tackle at tax time is your filing status. Your filing status dictates your tax bracket, as well as whether or not you are eligible for certain tax deductions and credits that are based on income.

Your tax filing status depends on your marriage situation, as well as whether or not you have dependents to support. Your tax filing status is largely based on your situation on the last day of the year, as well as what you have done to support others for at least six months of the year.

Here is a brief overview of the 5 different tax filing statuses:

Single

If you are unmarried on the last day of the year, or if you can be considered unmarried due to a legal separation, you usually file single. However, if you are claiming a dependent, and you have provided support for more than six months of the year, you might qualify to file as head of household – a status that comes with more tax benefits than filing as single.

Realize that for federal tax purposes, same-sex marriages are not recognized, even if you are legally married in your state of residence. You are considered single as far as the IRS is concerned.

Married, Filing Jointly

For many couples, this is a common filing status. If you are married, you can file a joint tax return, and this can provide you with a number of tax benefits. With a joint tax return, you combine all of your income together, as well as your deductions and credit.

You accept full responsibility for the return when you sign it, which means that if your spouse has been committing fraud, you could be on the hook for it. There are some instances where you receive dispensation for your spouse’s indiscretions, but, generally, a joint return means you act as one.

Married, Filing Separately

If you are married, you can choose to file separate returns. You each report your own income, and you need to coordinate your tax returns. You either both have to claim the standard deduction, or you both have to itemize. Additionally, there are a number of deductions and credits that you are completely ineligible for if you file separately.

If you are a same-sex couple, understand that you can’t use this filing status. Even though it might be tempting, since you are still filing separate returns, you can’t file as “married” in any form when it comes to your federal income tax return.

The main advantage to married, filing separately is that you can keep your tax liability separate from your spouse’s. This can be the smart play if you think that your spouse has been committing tax fraud, or if you are worried about being responsible for your spouse’s tax situation.

Head of Household

The head of household filing status provides you with a little bit of a better tax benefit than filing as a single, and recognizes your contributions to caring for a dependent. In order to file as a head of household, you need to be unmarried (or considered unmarried due to legal separation) on the last day of the year, pay more than half the cost of keeping up a home for the whole year, and a qualified dependent must has lived with you for more than six months (except in the situation of a parent, but you still have to provide the support).

Qualifying Widow or Widower with Dependent Child

If you used to be eligible to file a joint return, but your spouse died, you can take advantage of this filing status. Your spouse has to have died during one of the two preceding tax years, and you have not remarried during the tax year. Additionally, you need to maintain a home for a qualifying dependent child.

Carefully think about your situation, and choose the tax filing status that makes the most sense for your situation.

How are you planning on filing? Leave a comment!

Miranda writes about personal finance almost every day. An experienced freelance writer, she's covered your money online and in print from every angle and is always looking for new ones.

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