1.1 Which Filing Status Should You Use?

Your filing status generally depends on whether you are married at the end of the year, and, if unmarried, whether you maintain a household for a qualifying dependent. The five filing statuses are: single, married filing jointly, married filing separately, head of household, and qualifying widow or widower.

If you are married at the end of the year, you may file jointly (1.4) or separately (1.3). If you lived apart from your spouse for the last half of 2012 and your child lived with you, you may qualify as an “unmarried” head of household (1.12) for 2012, which allows you to apply more favorable tax rates than you could as a married person filing separately.

If you are unmarried at the end of the year, your filing status is single unless you meet the tests for a head of household or qualifying widow(er). Generally, you are a head of household (1.12) if you pay more than 50% of the household costs for a dependent child or relative who lives with you, or for a dependent parent, whether or not he or she lives with you. For 2012, you generally are a qualifying widow(er) (1.11) if you were widowed in 2010 or 2011 and in 2012 you paid more than 50% of the household costs for you and your dependent child. The tax rates for heads of household and for qualifying widow(er)s are more favorable than those for single taxpayers (1.2).

The filing status you use determines the tax rates that apply to your taxable income (1.2), as well as the standard deduction you may claim (13.1) if you do not itemize deductions. Certain other deductions, credits, or exclusions are also affected by filing status. For example, if you are married, certain tax benefits are only allowed if you file jointly, but more deductions overall may be allowed in certain cases if you file separately (1.3).

Marital status determined at the end of the year.

For federal tax purposes, a marriage means only a legal union between a man and a woman as husband and wife.

If you are divorced during the year under a final decree of divorce or separate maintenance, you are treated as unmarried for that whole year, assuming you have not remarried before the end of the year. For the year of the divorce, file as a single person unless you care for a child or parent and qualify as a head of household (1.12).

If at the end of the year you are living apart from your spouse, or you are separated under a provisional decree that has not yet been finalized, you are not considered divorced. If you care for a child and meet the other head of household tests (1.12), you may file as an unmarried head of household. Otherwise, you must file a joint return or as a married person filing separately.

If at the end of the year you live together in a common law marriage that is recognized by the law of the state in which you live or the state where the marriage began, you are treated as married.

If your spouse dies during the year, you are treated as married for that entire year and may file a joint return for you and your deceased spouse, assuming you have not remarried before year’s end (1.10).

Planning Reminder

Getting Married Can Raise Your Taxes

The so-called marriage penalty is faced by couples whose joint return tax liability exceeds the combined tax they would pay if single. This is generally the case where each spouse earns a substantial share of the total income. Legislation has substantially reduced the marriage penalty by allowing married couples filing jointly a standard deduction (13.1) that is double the amount allowed to a single person, and by allowing joint filers a 15% bracket (1.2) that is twice as wide as that for a single person.

On the other hand, if one spouse has little or no income, there generally is a marriage bonus or singles penalty, as the couple’s tax on a joint return is less than the sum of the tax liabilities that would be owed if they were single.

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