Taxpayers need to choose the correct filing status when they do their tax return. Your filing status not only determines your tax rate but also impacts the deductions and credits you’re eligible for. Let’s break down the different filing statuses, so you can make an informed decision come tax time.
What is Filing Status?
Your filing status categorizes you for tax purposes based on your marital status and family situation. There are five main filing statuses recognized by the IRS:
- Single: You are unmarried or legally separated from your spouse under a divorce or separate maintenance decree by the last day of the tax year.
- Married Filing Jointly: You are married and choose to file a joint tax return with your spouse. This status typically offers the lowest tax rates and the most generous deductions and credits. You can also use this status if you are widowed before the end of the tax year and do not remarry in the same year. With married filing jointly, you and your spouse are jointly liable for any taxes owed.
- Married Filing Separately: You are married but choose to file separate tax returns from your spouse. This status may be beneficial in certain situations, such as when one spouse has significant medical expenses or miscellaneous deductions. Some taxpayers elect “MFS” status if their spouse has prior tax obligations and do not want to link themselves to their spouse’s tax issues.
- Head of Household: You are unmarried, pay more than half the cost of maintaining a home for yourself and a qualifying person (such as a child or relative) and meet certain other criteria. This status offers lower tax rates and higher standard deductions compared to filing as Single.
- Qualifying Surviving Spouse: You are widowed, have a dependent child, and meet specific requirements. This status allows you to use the Married Filing Jointly tax rates and standard deduction for up to two years after your spouse’s death.
Who Qualifies for Each Status?
- Single: Unmarried individuals and legally separated or divorced individuals
- Married Filing Jointly: Married couples, and widow(ers) who did not remarry in the same tax year as spouse’s death, who want to combine their incomes and deductions on one tax return.
- Married Filing Separately: Married individuals who choose not to file a joint tax return with their spouse.
- Head of Household: Unmarried individuals who financially support dependents and meet specific criteria regarding household expenses.
- Qualifying Surviving Spouse: Widows or widowers with dependent children who meet certain conditions for two years following death of a spouse.
Benefits of Each Filing Status:
- Single: May qualify for certain tax credits and deductions available to individuals.
- Married Filing Jointly: Generally, offers the lowest tax rates and the highest standard deduction.
- Married Filing Separately: May be beneficial in certain situations, such as when one spouse has significant deductions or liabilities. Filing separately can also limit a spouse’s tax liability from their partner’s tax matters.
- Head of Household: Lower tax rates and a higher standard deduction compared to filing as Single.
- Qualifying Surviving Spouse: Allows the use of Married Filing Jointly tax rates and standard deduction for up to two years after the spouse’s death.
Married filing separately has some disadvantages v. filing jointly. In most circumstances, two spouses tax liability with be higher than if they file separately. Also, MFS taxpayers do not qualify for certain credits, such as the Earned Income Tax Credit, education credits, and the Child and Dependent Care Credit. MFS filers also cannot take the student loan deduction.
Filing Threshold for Each Status:
The filing threshold refers to the minimum income required to file a tax return. Here are the filing thresholds for each filing status in 2024:
| Filing Status | Filing Threshold | Additional Amount if Blind or over 65 years old |
| Single | $13,850 | $1,850 |
| Married Filing Jointly | $27,700 | $1,500 |
| Married Filing Separately | $13,850 | $1,500 |
| Head of Household | $20,800 | $1,850 |
| Qualifying Surviving Spouse | $27,700 | $1,500 |
Choosing the right filing status is essential for maximizing your tax benefits and minimizing your tax liability. Consider your marital status, family situation, and financial circumstances carefully when selecting your filing status. If you’re unsure which status applies to you, consult with a tax professional or use IRS resources for guidance. By understanding your options and making an informed decision, you can navigate tax season with confidence and potentially save money on your taxes.