What Is My Filing Status?
When you file your federal income tax return, one of the first decisions you need to make is selecting your filing status. Choosing the right one is crucial because it affects your standard deduction (assuming you don’t itemize), your tax bracket, and the types and amounts of other tax credits and deductions you claim.
Selecting a filing status is easy for some people, but it’s not always cut and dried for others. This article will help you choose the right filing status for your situation.
5 Tax Filing Statuses to Choose From
There are five tax filing statuses to choose from:
- Single. This status normally applies if you’re unmarried or legally separated as of the last day of the tax year.
- Married Filing Jointly. If you’re married as of the last day of the tax year, you and your spouse can choose to file a joint return. If your spouse died during the tax year, you might choose to file a joint return for that year.
- Married Filing Separately. A married couple can also choose to file separate tax returns. They might decide to file separately due to a separation or pending divorce, or simply because they prefer to keep their finances separate.
- Head of Household. In most cases, you must be unmarried to file as Head of Household, although there are some exceptions. However, you must have paid more than half the cost of keeping up a home for yourself and a qualifying person, such as a child or dependent relative.
- Qualifying Widow(er) with Dependent Child. This filing status may apply if your spouse died during the previous two tax years and you have a dependent child.
How to Choose the Right Filing Status
If you’ve never been married and don’t have any dependents, then Single is the only filing status available to you. But what if you’re married? Is it better to file jointly or separately? And what if you and your spouse are legally separated? In these situations, choosing the right filing status can be complicated.
These questions will help you decide.
Are you “unmarried” according to the IRS definition?
According to Publication 501, the IRS considers you to be unmarried for the whole year if, on December 31, you’re either:
- Unmarried, or
- Legally separated from your spouse or you’ve obtained a separate maintenance decree
State law determines whether you’re legally separated. However, if you and your spouse are living apart but not legally separated according to state law, you can’t choose Single as your filing status. You can file jointly, separately, or potentially file as Head of Household if you meet certain tests (explained in more detail below).
Did you get divorced during the tax year?
If you got a divorce during the year, the IRS considers you to be unmarried for the whole year. In other words, even if your divorce was finalized on Dec. 31, you can choose Single or Head of Household for your filing status, but not Married Filing Jointly or Separately.
Did your spouse pass away within the last two years?
If your spouse passes away, you can keep the benefits of the Married Filing Jointly filing status for two years after the year of their death. You can do this by filing a joint return the year of their death and electing the Qualifying Widow(er) tax filing status for the next two years.
For example if your spouse died during 2021, you’re allowed to file a joint return for 2021, as long as you didn’t remarry before the end of the tax year. You can also use the Qualifying Widow(er) filing status for your 2022 and 2023 tax returns, as long as you haven’t remarried and meet the following requirements:
- You have a child, stepchild, or adopted child that you claim as a dependent.
- You paid over half the cost of maintaining your home, which was the main home of your dependent child, for the entire year.
The Qualifying Widow(er) filing status allows you to claim the Married Filing Jointly standard deduction, which is double the amount available to single filers and higher than the standard deduction available to Head of Household filers.
Do you qualify as Head of Household?
Head of Household filing is a special filing status for single or unmarried people who maintain a home for a child or dependent relative. It’s advantageous because Head of Household filers can claim a larger standard deduction ($18,800 versus $12,550 for single filers in 2021), and more generous tax brackets.
But you have to meet strict requirements to claim the Head of Household filing status:
- You must be single or considered unmarried as of the last day of the tax year. For the purpose of claiming the Head of Household filing status, the IRS will consider you unmarried if your spouse didn’t live in your home during the last six months of the year or your spouse was a nonresident alien at any time during the year.
- You must have paid more than half the cost of keeping up a home for the year. The costs of keeping up a home include things like paying the rent or mortgage, property taxes, utilities, repairs and maintenance, property insurance, groceries, and other household expenses.
- You must have a qualifying person living with you in the home for more than half the year. Temporary absences, such as a college-age child going away to school, still count as living with you. If the qualifying person is your dependent parent, they don’t have to live with you. In that case, you need to pay more than half of keeping up their main home for the entire year.
Do you want to file jointly or separately from your spouse?
If you’re married according to IRS rules, then you can choose between filing jointly with your spouse or filing a separate tax return. There are pros and cons to each.
Advantages of Filing Separately
- To protect your refund. If your spouse has tax debts, defaulted federal student loans, or unpaid child support, filing separately can protect your tax refund from being seized by the Treasury Offset Program (TOP). If you file jointly and expect a large refund, the IRS may hold some or all of your refund to pay the debt. However, when you file separately, the IRS processes your refund separately, and it can’t be seized to pay for your spouse’s debts. It is important to note that community property states have different tax laws. If you elect to file a separate return from your spouse, you must report half of your spouse’s community income on your tax return, and your spouse must do the same.
- To avoid collections. Generally, both spouses are equally on the hook for the tax due when you file a joint return. For example, say your spouse underpaid their estimated taxes for the year and will owe a big tax bill you can’t afford to pay. Filing separately prevents the IRS from garnishing your paycheck or taking other collection actions to cover your spouse’s tax debt.
- Legal protection. When you file a joint return, you’re jointly responsible for everything on the return. If you’re worried that your spouse is underreporting income, padding deductions, or claiming tax credits you’re not eligible to take, filing a separate return protects you from being on the hook for their fraudulent tax reporting.
Disadvantages of Filing Separately
- Less flexibility when choosing between itemizing or the standard deduction. When you file separately from your spouse, if one spouse itemizes, both must itemize. If one of you has few itemized deductions but is forced to itemize, your taxable income may be higher than it would be if you’d been able to claim the standard deduction.
- Potentially losing tax breaks. With the Married Filing Separately filing status, IRS rules prevent you from claiming several valuable tax breaks, including the Lifetime Learning Credit, the American Opportunity Tax Credit, student loan interest deduction, the Earned Income Tax Credit, the Child and Dependent Care Credit, and the credit for adoption expenses.
In short, filing separately makes sense in some situations, but filing jointly is almost always simpler and usually results in a lower overall tax bill. Perhaps that’s why for the 2019 tax year (the most recent year for which IRS statistics are available), only around 6% of married taxpayers chose to file separate returns.
If you’re still unsure whether filing jointly or separately is right for you, most tax preparation software includes an option to see which one results in a lower overall tax bill.
Still not sure which filing status applies to your situation? The IRS’s What Is My Filing Status? Tool will ask a few questions about your marital status, spouse’s year of death (if applicable), and household and provide a recommendation. However, it’s not available for 2021 tax returns just yet—check back for updates in mid-January 2022.
It’s possible that more than one of the above filing statuses applies to your situation. In that case, you can choose the one that allows you to pay the least amount of tax.