When you file your taxes, selecting the correct filing status for your situation is extremely important. Selecting the most advantageous option for you can boost your tax refund through a larger standard deduction or more generous limits to claim other deductions and credits. However, if you use a filing status for which you’re not eligible, you could face tax penalties for incorrectly filing your return.
TL;DR (Too Long; Didn't Read)
You usually have to be unmarried to file taxes as head of household, but the IRS has a limited exception if you meet the criteria to be considered unmarried for the year.
Head of Household Rules
In general, you are not allowed to file as head of household if you are married. To file your taxes as head of household, you must be unmarried or considered unmarried, you must pay more than half the cost of keeping up your house and a qualifying person must live with you for more than half the year. When calculating the costs of keeping up your home, include expenses like rent or mortgage payments, real estate taxes, homeowner’s insurance, maintenance and repairs, utilities and food eaten at home. You can’t include the costs of education, medical care, transportation or clothing.
Exception if Considered Unmarried
If you are legally married but meet certain conditions, the IRS may consider you unmarried for purposes of filing as head of household if several conditions are met. First, you can’t be filing a joint return with your spouse. Second, you must pay more than half the cost of keeping up your home during the year. Third, you can’t have lived with your spouse during the last six months of the year. Fourth, your residence must be the main home for your child, step child or foster child. Finally, you must be able to claim an exemption for your child or be unable to only because the noncustodial parent is entitled to claim the exemption.
Increased Standard Deduction in 2018
There isn’t any change from 2017 to 2018 in the requirements for being able to use the head of household tax filing status. However, the standard deduction has increased dramatically. If you’re married filing separately, the standard deduction has increased to $12,000. If you qualify to file as head of household instead, you can claim a standard deduction of $18,000, a difference of $6,000.
2017 Head of Household Taxes
In 2017, the difference in the standard deduction for head of household versus married filing separately was small. The married filing separately standard deduction was $6,350, while heads of household claimed a standard deduction of $9,350. While the $3,000 is still significant, it’s only half of the difference between the 2018 standard deductions.
Based in the Kansas City area, Mike specializes in personal finance and business topics. He has been writing since 2009 and has been published by "Quicken," "TurboTax," and "The Motley Fool."