One of the first decisions you'll have to make when doing your taxes is what filing status to choose. It might sound simple, but it's easy to get tripped up. Are you considered a head of household if you're the only person in your household? Is it smarter for you and your spouse to file taxes jointly or separately? And who qualifies for qualifying widow(er) status?
It pays to understand the distinctions between the various filing statuses because the status you choose affects your standard deduction and your tax bracket for the year. If you choose the wrong one, you could cost yourself money or run into problems with the government for tax evasion. Here's everything you need to know about each of the five tax filing statuses to determine which one you should choose.
The five tax filing statuses, summarized
|Single||Married Filing Jointly||Married Filing Separately||Head of Household||Qualifying Widow(er)|
|Standard Deduction (2019 Tax Year)||$12,200||$24,400||$12,200||$18,350||$24,400|
|Who Can Claim||Single adults with no dependents||Married couples||Married couples||Single adults with dependents||Single adults with dependents whose spouse has died within the last two years|
|Notes||Individuals divorced as of Dec. 31 of the tax year would also claim this status, unless they have qualifying dependents.||This status makes the most sense for most married couples.||You cannot claim many common tax credits and deductions if you choose this status. If one partner chooses to itemize deductions, the other one must also.||Dependents are children under 19 (or under 24 if attending school and living with you) or other family members you provide more than half of the financial support for.||If your spouse died in the tax year you're filing for, you can use married filing jointly status this year and qualifying widow(er) status the next two years.|
Are you unmarried with no children or other dependents? Then you can only claim the single tax filing status. This status includes a $12,200 standard deduction for the 2019 tax year. Your standard deduction is the amount you get to write off on your taxes if you do not itemize your deductions.
If you got divorced during the year and you don't have any children or other dependents, you would also claim single status. That's because the IRS bases your tax filing status on your marital status as of Dec. 31 of the year for which you're filing taxes.
Married filing jointly
Married filing jointly is the status most married couples use. It's so popular because you get double the standard deduction of single filers -- $24,400 for 2019 -- one single standard deduction for each person. You can also earn a lot more money before you move into the next tax bracket. This could potentially save you money on taxes because you'll lose a smaller percentage of your income to the government.
When you file taxes jointly, the IRS considers your combined income, rather than each person's income separately, and any deductions or credits you qualify for will reduce your combined taxable income or your joint tax bill, respectively. You can file joint taxes even if only one spouse earned income for the year. Filing this way means both of you are responsible for ensuring that your taxes are done correctly and for paying any outstanding balance. The IRS will come after both of you if something is wrong. You can't just point the finger at one spouse.
Remember, you can only claim this tax filing status if you're legally married as of Dec. 31 of the year for which you're filing taxes. If you were married for part of the year but are divorced as of Dec. 31, you would file as either single or head of household, depending on whether you have dependents in your home.
Married filing separately
Married filing separately is the other option married couples have. If you choose this status, you're asking the government to consider you and your spouse's incomes separately, and you'll each be held responsible for the accuracy of your own tax returns and paying any tax bills. This tax filing status gives each person the same standard deduction and tax brackets as single filers, except for the 35% and 37% tax brackets where the income thresholds are lower for married couples filing separately than they are for single filers. Single filers can earn up to $510,300 before they move into the 37% tax bracket for the 2019 tax year, while married couples filing separately are limited to just $306,175.
It doesn't make sense for most married couples to use this status because it usually results in you paying more in taxes than you would have if you filed jointly. However, it could make sense in certain situations, like if you're getting a divorce and you think your partner might be hiding some of his or her income from you and the government. Filing separately ensures you aren't held responsible for the other person's tax bill. Filing separately might also make sense if you have a student loan repayment plan that bases your payments on your adjusted gross income (AGI) for the year. In this case, filing jointly would probably raise your student loan payments, while filing separately could prevent this.
The downside to filing separate taxes and a key reason most married couples don't do it is that it renders you ineligible for many common tax credits and deductions, including the Earned Income Tax Credit, student loan interest deduction, and the American Opportunity Tax Credit. Missing out on these tax breaks could result in a bigger bill for you.
The last thing to note about the married filing separately status is that if one spouse chooses to itemize their tax deductions, the other spouse has to, too, even if the standard deduction would be a better choice for them.
Head of household
The head of household status is for unmarried adults who provide at least half of the financial support for another person for over half of the year. Note that this dependent does not have to be a child, although it can be. It could also be a dependent parent, sibling, or other family member, as long as you claim them on your tax return as a dependent and provide most of their financial support. Qualifying children must be under 19, or up to 24 if he or she is attending a college or university and lives with you for at least half the year.
You might be able to claim this status even if you're married, but only if your spouse didn't live with you for the last six months of the tax year and your dependent lived with you for more than half the year. Again, you must be the one providing most of your dependent's financial support. If your spouse isn't living with you because you're separated, but he or she is still providing most of your dependent's financial support, you cannot claim head of household. If you do qualify for head of household status while married, your spouse can file taxes as married filing separately.
The head of household status has a $18,350 standard deduction for the 2019 tax year, which is higher than the standard deduction for single filers and married couples filing separately, though not as high as the standard deduction for married couples filing jointly. The tax brackets for heads of household also fall in between those for single filers and those for married couples filing jointly.
The qualifying widow(er) status is available to individuals whose spouse died within the last two years and who are supporting a qualifying child at home. The child must be under 19 or up to 24 if attending school and still living with you. Qualifying widow(er) status gives you the same standard deduction and tax brackets as a married couple filing jointly, even though your spouse is deceased. But you can't claim it without a qualifying dependent.
If your spouse died during the year for which you're filing taxes, you can actually claim married filing jointly status for this year, even if you hadn't planned to file joint taxes. Then, the next two years, you can claim qualifying widow(er) status, assuming you still have a qualifying child at home and have not remarried.
Hopefully you were able to identify your tax filing status, but if you're still not sure what's best, that's OK. Your tax filing software should ask you some questions to determine which tax filing status is best for you, and if you're having someone else do your taxes, that person should figure this out for you. Still, it's best to have some understanding of how it all works so you'll know what to expect come tax time.