The filing status you select is a critical part of filing your return. Though the decision may not seem like a big deal, your choice can have a big impact on the size of your tax bill. If you’ve experienced a major life change like marriage, divorce, or widowhood, it’s crucial to pay close attention to how these changes affect your filing status and your taxes.
The IRS has simplified the process by having taxpayers choose from among five statuses. Consider the following to understand how each status has a different impact on your tax situation.
Taxpayers who are unmarried, legally separated, divorced, or widowed as of December 31 of the tax year are eligible to file as single. Divorced or separated parents who don’t have primary custody of their children may also qualify as single. (Custody comes into play in the Head of Household status, below.)
Married Filing Jointly
If you are legally married as of the last day of the tax year, you qualify to file as married filing jointly. This status means both spouses are responsible for reporting any income earned and paying any taxes due. Choosing to file jointly offers the couple tax benefits beyond what’s available if each spouse opted to file as an individual, such as a larger standard deduction and some additional tax credits. As a result, the majority of married couples choose this option.
Married Filing Separately
Some couples choose to file their taxes separately despite being married. Filing separately may make the most sense in a few key scenarios, such as when combining their incomes would bump them into a higher tax bracket. Another scenario: One spouse earns a lower income but has large deductions, such as medical bills, that they might not qualify to use when filing jointly. If you think filing separately might be advantageous, consider calculating your taxes both jointly and separately to make sure you’re choosing the best status for your situation.
Head of Household
If you’re unmarried at the end of the year and pay for more than half of all household expenses for yourself and a dependent who has spent at least six months of the year living with you, then you can file under this status. If you’re paying more than half of a parent’s expenses, you may also qualify to file as head of household. Filing as head of household generally means you’ll get a lower tax rate and a higher standard deduction than if you filed as single or married filing separately.
Qualifying Widow or Widower With Dependent Child
If your spouse died during the current tax year, you still can file as married filing jointly for that year. And, for the next two years, you may file as a qualifying widow or widower with a dependent child, provided you meet the following criteria:
- You haven’t remarried.
- You’ve cared full-time for a child or stepchild.
- You’ve paid for more than 50 percent of household costs during the year.
Filing as a qualifying widow or widower means the surviving spouse can use the same tax rates as couples who are married filing jointly, and also receive the highest standard deduction.
After the two-year period is over, you’ll have to choose either single or head of household status, depending on your situation. If you remarry, of course, you’ll need to choose a status that reflects that fact.
For more information on the ins and outs of the five different statuses, check out IRS Publication 501, Exemptions, Standard Deduction, and Filing Information.
A version of this article appeared in our partner magazine, The Essential Tax Guide: 2023 Edition.