Claiming the head of household filing status on your tax return requires nothing more than checking the appropriate filing status box on your tax form. But before you do that, you'll need to make sure you can satisfy an extensive set of eligibility requirements. If you do, you stand to save more than filing as single, since head of household filers get a larger standard deduction and more favorable tax rates.
Must Be Considered Unmarried
You must be either unmarried or “considered unmarried” to claim head of household status. If you're divorced or legally separated, or never married, you'll satisfy this condition. However, if you're still legally married, you can be considered unmarried if you file a separate tax return from your husband. In addition, you must cover more than half the expense of maintaining a home that's the main home of your child, stepchild or foster child and also be eligible to claim a dependent exemption for him. The final requirement to be considered unmarried is that you not share a home with your husband during the last six months of the tax year.
Pay a Majority of Living Expenses
If you only pay a portion of your annual housing expenses and aren't sure if you pay more than half, it may be helpful to prepare an itemized list of the expenses that the Internal Revenue Service permits you to consider and compare the total to the amounts you contribute. Housing costs include rent, or if you own your home, mortgage interest, home insurance premiums and real estate taxes. You can also consider the cost of home repairs and utilities, such as electricity, gas and oil. Do not include clothing, education, medical or transportation costs for yourself or your child.
Live with a Qualifying Person
To claim head of household, at least one “qualifying person” must live with you for more than half the tax year. Note that even if under the dependent eligibility rules you don't have to live with the person because of your relationship, you still need to live together under the head of household rules. Your parents, however, are the only qualifying persons who aren't required to live in your home. Provided you're eligible to claim your parent as a dependent and pay for more than half their housing costs -- which includes nursing homes and other assisted living communities -- they can make you eligible to claim the head of household filing status.
Who Is a Qualifying Person?
Aside from your parents and any child you can claim as a dependent, other adults can serve as your qualifying person. These are the people whom the IRS allows you to claim as dependents under the qualifying relative rules. But under the head of household rules, you must live together for more than half the year. In other words, you can't always use the head of household filing status just because you claim someone as a dependent. Some of the eligible people include your adult children, siblings, nieces and nephews, and even your former or current mother-in-law. You must provide more than half of the qualifying person's financial support. Moreover, an individual whose gross income is equal to or more than the one dependency exemption -- which is $3,900 for the 2013 tax year, but increases with inflation -- cannot be a qualifying person.
Michael Marz has worked in the financial sector since 2002, specializing in wealth and estate planning. After spending six years working for a large investment bank and an accounting firm, Marz is now self-employed as a consultant, focusing on complex estate and gift tax compliance and planning.