File as Head of Household
In order to file your federal tax return as head of household, you must meet the following qualifications: you were unmarried or considered unmarried on the last day of the tax year; you paid more than half of the cost for the upkeep of a home; and you had a qualifying person living with you in your home for at least half the year. If you meet the qualifications for head of household, generally your tax rate will be lower than the rates for single or married filing separately and you will receive a higher standard deduction. This could lead to a tax savings or a greater refund.
Qualifying Based on Marital Status
- Determine your IRS marital status. The first qualification to file as head of household is that you must be unmarried on the last day of the tax year. For purposes of filing as head of household, the IRS considers you unmarried for the whole year, if on the last day of the tax year you were:
- Unmarried; or
- Legally separated from your spouse under a divorce or separate maintenance decree.
- For those who were married or getting divorced, the IRS defines unmarried as having obtained a final divorce decree or decree of annulment by the last day of the tax year and meeting your state’s definition of unmarried for tax purposes (discussed below).
- The IRS will consider you married and require you to file as married if you only divorced for tax purposes and remarried your spouse in the following tax year.
- Clarify your status if you were divorced or separated during the tax year. If you were divorced or legally separated during the tax year, you must determine whether your own state considers you unmarried for purposes of filing your taxes. The IRS defers to each state’s definition of married/unmarried as established by state tax law.
- For example, in Texas you are considered married for tax purposes until there is a final divorce decree, even if you are legally separated.
- You must look at your state government’s tax website or state tax law to determine whether you are considered married for tax purposes.
- You can find a link to state government tax websites at: https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/State-Links-1.
- Once on the state tax website, you may need to conduct a search for “unmarried” and “taxes.”
- You can also conduct an internet search for the name of your state and the words “married for tax purposes and legal separation.” This search should direct you to the appropriate state website.
- Choose how to treat your spouse who is a nonresident alien. If your spouse was not a U.S. citizen (alien), he or she may be considered a nonresident alien during the tax year, which would mean that you are considered unmarried for head of household purposes. However, the IRS has set forth two tests that determine whether your spouse is in fact a resident alien. If under either of these tests your spouse is determined to be a resident alien, you will be considered married for tax purposes. The two tests are the green card test and the substantial presence test.
- Determine your spouse’s residency status under the green card test. Under the green card test, your spouse is a resident for tax purposes if you are a lawful permanent resident of the United States at any time during the calendar year for which you are filing taxes.
- If you are considered a resident alien under this test, you do not have to take part in the substantial presence test.
- If you are considered a nonresident alien, you must determine your spouse’s residency status under the substantial presence test.
- Determine your spouse’s residency status under the substantial presence test. The substantial presence test is a two-part test that looks at the number of days that your spouse was physically present in the U.S. during the previous three years, beginning with the tax year for which you are filing.
- The first part of test asks whether the person in question was physically present in the U.S. for at least 31 days during the tax year. If your answer is no, then your spouse is considered a non-resident alien. If your answer is yes, you must move to the second part of the test.
- The second part of the test asks whether the person in question was physically present in the U.S. for at least 183 days during the previous 3-year period (the tax year for which you are filing and two years immediately before). You must calculate the 183 days as set forth below.
- For the current tax-filing year, add up all of the days that your spouse was present in the U.S. For example, if your spouse was present for 60 days, all 60 days would count towards the 183 total.
- For the year prior to the tax year, add up all of the days your spouse was present and divide the total number of days for that year by 3. The answer (or quotient) is the number of days from this year that counts toward the 183 day total. For example, if your spouse was present for 30 days, divide 30 by 3 and the number of days that would count towards the 183 total is 10.
- For the year 2 years prior to the tax year, add up all of the days your spouse was present and divide the total number of days for that year by 6. The answer is the number of days from this year that counts toward the 183 day total. For example, if your spouse was present for 36 days, divide 36 by 6 and the number of days that would count towards the 183 total is 6.
- Add the total numbers of days from all three years together. Using the numbers in the examples above, you would add 60 + 10 + 6= 76.
- If the number is 183 or greater, you are considered a resident alien for tax purposes. If the number is less than 183, your spouse is considered a nonresident alien and you will be considered unmarried for head of household purposes.
Paying More than Half of the Cost for the Upkeep of Your Home
- Gather all financial documents related to your home. In order to meet the second qualification to file as head of household, you must be able to show that you paid more than half of the upkeep for your home during the tax year. Upkeep of the home is considered broadly, and includes not only utility bills and rent/mortgage but also the cost of food eaten in the home. In order to document the amount of money that you spent for upkeep in your home, you should gather the following:
- All bank statements that show transactions for the tax year for which you are filing.
- All canceled checks or your check recorder.
- All credit card statements for the tax year for which you are filing.
- Any and all receipts related to the upkeep of the home, including receipts for groceries or meals that you ate in the home or for appliances or other maintenance items that were purchased for the home.
- If you are unsure of what you paid in utility bills, generally you can request past bills online or via phone from the utility company.
- Calculate the total cost of keeping up a home for a year. The IRS suggests that you break down the total costs for upkeep and the share that you paid into the following categories of allowable costs:
- Property taxes.
- Mortgage interest expense.
- Utility charges.
- Property insurance.
- Food eaten in the home.
- Other household expenses.
- In calculating upkeep costs, you cannot include the cost of clothing, education, medical treatment, vacations, life insurance, or transportation. In addition, you cannot include the rental value of a home that you own or the value of your services or those of a member of your household.
- The IRS provides a chart that you can use to track the costs at: https://apps.irs.gov/app/vita/content/globalmedia/teacher/cost_of_keeping_up_home_4012.pdf.
- Determine whether your share of the upkeep was more than half. Once you have calculated all of the costs associated with upkeep of the home, you must determine what share, if any that you contributed to each category and what share other people paid. If the total amount that you paid is more than the amount others paid, you meet the requirement of paying more than half the cost of keeping up the home.
Determining Whether a Qualified Person Lives With You
- Determine whether someone lived with you for half of the year. The final qualification for filing as head of household is that a qualified person lived with you in your home for more than half the year, except for temporary absences such as attending school. If someone other than your spouse did not live with you for more than half of the tax year for which you are filing taxes, then you will not meet this requirement. If someone did live with you for more than half of the year, then you must check to see if that person meets the requirements of a qualifying person.
- There is an exception to this requirement. If the qualifying person is your dependent parent, he or she is not required to live with you.
- Determine whether your child is a qualified person. A child may be considered a qualifying child if they meet the following test:
- The child is your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of one of these people.
- The child is under age 19 at the end of the tax year for which you are filing and younger than you and your spouse if filing jointly; or your child is a student, under the age of 24, and younger than you and your spouse, if filing jointly; or your child is permanently and totally disabled at any time during the year, regardless of age.
- The child lived with you for more than half of the year.
- The child did not provide more than half of his or her own support for the year.
- The child is not filing a joint return for the year, unless that joint return is filed only to claim a refund of withheld income tax or estimated tax paid.
- Determine whether a qualifying relative lived with you. Another category of qualifying person is a relative that lived with you. In order to meet the IRS’ requirements for a qualifying person, your relative must meet the following test:
- The person cannot be your qualifying child or the qualifying child of any other taxpayer.
- The person must either be a relative exempt from living with you or must live with you as a member of your household for the entire year and the relationship cannot break local law.
- Relatives who are exempt from living with you include: your child, stepchild, foster child, or a descendant of any of them; your brother, sister, half brother, half sister, stepbrother, or stepsister; father, mother, grandparent, or other direct ancestor, but not foster parent; stepfather or stepmother; a son or daughter of your brother, sister, half brother or sister; a brother or sister of your father or mother; or your son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law.
- If you meet both the qualifying person test and the requirements for how long a person was required to live with you during the tax year, you satisfy the third qualification to file as a head of household.
Indicating Head of Household on Your Tax Returns
- Use the correct tax form. Once you have determined that you meet the three qualifications for filing as head of household, you can only claim head of household status by filing either an IRS Form 1040A or Form1040.
- You can download these forms from the IRS at: https://www.irs.gov/Forms-&-Pubs.
- Check the box labeled “Head of Household.” Once you have entered in your personal information, you should check the box labeled “Head of Household,” to indicate your filing status.
- You can also claim an exemption for your yourself and each of your dependents, so long as no other taxpayer can claim you as a dependent.
- Complete your taxes. Once you have designated yourself as head of household, you should then provide all of the required information in IRS Form 1040 or Form 1040A.
- If claiming head of household, but the other spouse is claiming the child as an exemption (to fairly share child-related tax savings), you should file Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent. This form allows the non-custodial parent to claim the child as a dependent.
- A dependent can only be used by one taxpayer to claim head of household status. When parents are divorced or separated, they cannot both use the same child to claim head of household filing status.
- Check the tax code each year before filing your income tax return, as the requirements to file under head of household status may change.
- Function In a Multigenerational Household
- Fill out IRS Form 1040
- Fill Out a US 1040A Tax Return
- Fill Out a US 1040EZ Tax Return
- Fill Out a US 1040X Tax Return
- Make Filing US Taxes Easier
- Determine Your Tax Filing Status
- Fill in US Tax Deductions and Credits
- Avoid Tax Problems
- Be a Tax Preparer
Sources and Citations
- https://www.irs.gov/publications/p504/ar02.html; http://taxmap.ntis.gov/taxmap/pub17/p17-010.htm#en_us_publink1000170736