Should You File Your Return Single?
Should You File Your Return Married Filing Jointly?
Should You File Your Return Married Filing Separately?
Should You File Your Return as Head of Household?
These simple guidelines will help you determine your filing status and give you a leg up on understanding the nuances of what tax filing status you can legally claim on your personal return. There is much confusion over what is allowable in making these determinations and the below overview will do much to erase many of the existing mystiques surrounding the proper status and therefore the correct filing of your personal return.
Single - Only taxpayers who are single on the last day of a tax year may claim single status. It does not matter what your marital status is on the first 364 days of the year but only what is your status on the last day of the tax year/December 31st, which is the key determining factor. A taxpayer who is married on the last day of a tax year cannot claim single status regardless of whether they want to file a return without their spouse.
Head of Household - To qualify as filing as head of household a taxpayer generally must have a dependent child who lives with them throughout the year. However a single taxpayer who is allowed by a divorce decree to claim a child as a dependent, but the child does not predominantly live with them, does not qualify for Head of Household Status. Conversely, a child who predominantly lives with a parent for most of the year, can still claim Head of Household Status even if the decree specifies the other parent to be eligible for the dependency exemption in a given year. Generally speaking, married individuals with dependents who do not live with their spouses for the second half will also qualify for Head of Household status. The Head of Household tax rate is the second lowest behind the tax rates of those who are married and filing a joint return.
Married Filing Jointly & Married Filing a Separate Return- Taxpayers who are married on the last day of the year must file as either Married Filing a Joint Return, Married Filing Separately, or Head of Household (see above). Generally speaking it us usually most advantageous to file a joint return if one can, as most often the aggregate tax bill will be lessened and the attendant reporting less due to the filing of one return vs. two. You will want to keep in mind that the Married filing a joint return is the lowest of the overall tax rates/brackets and that Married Filing Separately is the most expensive/highest tax brackets.
Please be reminded these are general guidelines only and that you should work closely with your CPA to determine which filing status you are able to claim to ensure you fully understand and qualify for the status you will be claiming.
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