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Filing Status

Although there are only two filing statuses for 1040EZ users, single and married filing jointly (with no dependents), there are 5 filing statuses you must choose from when filing a 1040 or 1040A. Each filing status is associated with it's own tax rate. The 5 filing statuses are as follows:

• Single
• Married filing separately
• Married filing jointly
• Head of household
• Qualifying widow(er) with dependent child

Single - Single means exactly what you would expect it to mean. Never-before-married, widowed, divorced or legally separated people may file as single. If you have dependents that you provide support for, you may qualify for other filing statuses which would increase your savings in tax dollars, such as the head of household or qualifying widow(er) statuses.

Married filing separately - The majority of couples choose not to file under this status as they can usually save more money filing jointly. However, there are certain circumstances under which some couples may benefit from filing separately. In addition, this status comes in handy if you suspect your spouse has been underreporting his income or exaggerating deductions and you do not want to be held responsible for your mate's share of the tax bill. The best way to determine if you would benefit from filing separately as opposed to jointly is to figure your taxes both ways.

Married couples that are most likely to benefit from filing separately as opposed to filing jointly usually meet the following requirements:

• Couples who have two incomes
• Couples with heavy deductions for medical expenses, miscellaneous itemized deductions or casualty losses

The following restrictions may apply if filing separately:

• Both spouses must itemize deductions or both spouses must take the standard deduction. It is not permissible for one to itemize deductions and the other to take the standard deduction
• You may not take the earned income credit
• In most cases, you cannot claim credit for child and dependent costs
• Unless you have lived apart from your spouse for the entire year, you may not be able to claim credit for being elderly or disabled
• You cannot claim credit for a qualified adoption expenses
• You may have to include 50-85% of any Social Security benefits you received throughout the year as income
• You may not deduct interest paid on a student loan
• You cannot claim Hope Scholarship and Lifetime Learning credits
• You may qualify for a lower Child Tax Credit filing separately than you would filing jointly
• You are not allowed to claim the $2,000 IRA deduction for a nonworking spouse and you may not be able to deduct all or any of your $2,000 IRS contribution should your spouse be covered by a separate retirement plan

Married filing jointly - Most married couples choose to file under this status as most find they save the most money in taxes this way. A married couple may file jointly even if only one spouse earned income or if they lived separately for the entire year. When you file jointly, both people are assuming responsibility for the taxes owed. That means if your spouse skips out on his share of the taxes, you may be held responsible for it. However, the Innocent Spouse Rule can provide some relief to a spouse who was unaware of a partner's wrongdoings concerning taxes. In order to file jointly, you must meet any of the following requirements:

• You were married as of the last day of last year
• Your spouse died during the last year and you did not remarry in that year
• Your spouse died this year, but before you filed your tax return for last year

Head of household - You may be entitled to file as the head of household if you maintain a home under one of the following conditions:

• You paid more than half the cost of maintaining the main home for a parent that you can claim as a dependent (this parent did not live in your home)
• You are legally married but did not cohabitate with your spouse, even if you were not legally separated or divorced during the last year if you fulfill all the following requirements:
  • You lived apart from your spouse for the last half of the year and you are filing a separate return
  • You paid more than half of the cost of maintaining your main home in the past year in which your foster, adopted, step or natural child resided for more than half of the year.
  • You paid more than half of the cost of maintaining your main home in the past year in which one of the following also lived for more than half of the year:
  • An unmarried adopted child, natural child, stepchild, grandchild or great-grandchild that is or is not your dependent (if this child is not your dependent, you must enter the child's name on line 4 of Form 1040 or 1040A.)
  • A married adopted child, natural child, stepchild, grandchild or great-grandchild that is your dependent (unless this child's other parent claims him as a dependent under IRS rules)
  • A foster child that is a dependent
  • Any of the following relations whom you claim as a dependent: siblings, parents, grandparents, step-relatives, in-laws or aunts, uncles, nieces or nephews who are blood related.

Qualifying widow(er) with dependent child - If your spouse died in the past year, you can use married filing jointly as your filing status if you would otherwise qualify to use that status. You may be eligible to use qualifying widow(er) with dependent child as your filing status for the next two years following a spouse's death if you have not remarried. This status entitled you to use joint return tax rates and the highest standard deduction amounts (if you do not itemize deductions.) This status does not however entitle you to file a joint return. You indicate this status on your tax return by checking the appropriate box on line 5 of Form 1040 or 1040A and writing the year your spouse died in the space provided on line 5. In order to fit the qualifying widow(er) with dependent child status, you must meet the certain criteria:

• You were entitled to file a joint tax return with your spouse the year he/she died (regardless of whether you actually did)
• You have a child, stepchild, adopted child or foster child that you claim as a dependent
• You did not remarry before the end of the tax year for which you are filing
• You paid more than half of the cost of maintaining your main home in the past year in which your dependent child lived for more than half of the year