Tax Topics

Jackson Hewitt® is here to help you understand complex tax laws so you can be better informed and take full advantage of tax law provisions.

These topics explore some of the more important aspects of complicated tax laws, in a manner that is understandable and concise.


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Filing Status

Every year, some employees overpay their income taxes because they use the wrong filing status. Don't let this happen to you. Jackson Hewitt Tax Service is in the business of saving you money.

 

Your tax filing status is vital because it determines:

  • Whether you are required to file a return
  • The correct rate at which you should be taxed
  • The amount of your standard deduction
  • The tax credits and deductions to which you are entitled

The five IRS tax filing status categories are:

  • Single
  • Married Filing Jointly
  • Married Filing Separately
  • Head of Household
  • Qualifying Widow(er) with dependent child

When considering which tax filing status you can use, you should also consider:

  • Your marital status on December 31 determines your marital status for the entire year.
  • You cannot change your tax filing status from Married Filing Jointly to Married Filing Separately after the due date of the return.
  • If you and your spouse choose to file a joint return and there are state or federal taxes due, you will both be responsible for the debt.
  • A joint return requires both signatures. If your spouse is away from home, you should either sign the completed return and send it to your spouse to sign and mail, or obtain a power of attorney to allow you to sign for your spouse.

If more than one tax filing status applies to you, you should choose the one that gives you the lowest tax. Married Filing Jointly and Qualifying Widow(er) with Dependent Child usually give you the lowest tax and highest standard deduction, followed by Head of Household, Single, and Married Filing Separately, respectively.

 

Your marital status helps determine which tax filing status you qualify to use. You are considered unmarried for tax filing status purposes if you have never been married, or if your marriage has been annulled. You are also considered unmarried for the entire tax year if you are divorced or legally separated under a separate maintenance decree on the last day of the year.

Marriage Qualifying Tests

Generally, you are considered married for the entire tax year if you and your spouse meet any of the following tests on December 31 of the year:

  • You are legally married and living together. Legal marriage includes a marriage between two people of the same gender entered preformed and registered in a state, country or other jurisdiction where same gender marriage is legal.
  • You are married and not living together, but you are not divorced or legally separated under a separate maintenance decree.
  • You are living together in a common law marriage that is recognized in the state where you now live or in the state where the common law marriage began.
  • State law governs whether you are considered married, divorced, or legally separated under a separate maintenance decree.
  • You must end a marriage through divorce, annulment, or a legal separation to be no longer married.
  • State law where you reside governs your marital status for the state tax return.

If you do not live with your spouse during the last six months of the year and you meet certain other tests, you may be considered unmarried for the Head of Household filing status, even if you are not divorced or legally separated.

 

If your spouse died during the tax year, you are considered married for the entire year for filing status purposes.

 

Contact your neighorhood Jackson Hewitt office for more information or assistance. Use the Office Locator feature available on this Web site or call 1-800-234-1040 to find the Jackson Hewitt location nearest you.

Single

Use this tax filing status if you are unmarried or legally separated from your spouse (by divorce or separate maintenance) and do not qualify for any other filing status. Your tax filing status may also be Single if you were widowed in a previous year and did not get married again during the year. (See also Head of Household and Qualifying Widow(er) with Dependent Child, which carry lower tax rates and higher standard deductions.)

Married Filing Jointly

You and your spouse may choose to file a joint return, which combines your incomes and allowable expenses. The tax rate may be lower than the rates for other filing statuses and, if you do not itemize deductions, the standard deduction could be higher.

 

If you file a joint return, both you and your spouse may be held responsible, jointly and individually, for the tax and any interest or penalty due on that return. Each spouse may be held responsible for all the tax due even if only one spouse earned all the income. However, in some cases, one spouse may be relieved of joint liability for tax, interest, and penalties on a joint return if they can satisfy certain IRS requirements.

 

On June 26, 2013, the Supreme Court of the United States found the federal definition of marriage between a man and a woman only to be unconstitutional.

If your spouse died during the tax year and you did not get married to someone else before the end of the year, you are considered married to your deceased spouse for the entire year. In this case, you can use Married Filing Jointly as your tax filing status on a tax return for you and your deceased spouse. If you were married again before the end of the year, you can file a joint return with your new spouse; a separate return will have to be filed for the deceased spouse (if required to file) with Married Filing Separately designated as the tax filing status for the deceased spouse.

 

If you are divorced under a final decree by the last day of the year, you are considered unmarried for the whole year and you cannot choose Married Filing Jointly or Married Filing Separately as your tax filing status.

Married Filing Separately

The tax rate for this status is higher than the rates for other filing statuses. This status may benefit you if you choose to be liable only for your own tax or if both you and your spouse have high incomes or certain itemized deductions. If you use this status and either you or your spouse decide to itemize your individual deductions, you both must itemize your individual deductions. Certain credits such as the Earned Income Tax Credit and the Child and Dependent Care Credit are usually not allowed when you are Married Filing Separately.

Unless you are required to file separately, you should calculate your tax both ways (using Married Filing Jointly and using Married Filing Separately as your tax filing status). This ensures you choose the tax filing status that gives you and your spouse the lowest combined tax.

If you file a separate return, you generally report only your own income, exemptions, credits, and deductions. You usually cannot take the personal exemption for your spouse and you can never claim your spouse as your dependent.

After the due date of the tax return, you usually cannot change the tax filing status on your return from Married Filing Jointly to Married Filing Separately. You can only make this change if you file the corrected returns before their original due date.

Head of Household

This status applies if you are unmarried on the last day of the year and if, for more than six months of the tax year, you paid more than half the cost of the upkeep of a home for yourself and a qualifying person. Other tests apply for a married individual to be "considered unmarried" for this status. Generally, your tax rate will be lower and your standard deduction higher than if you use the Single or Married Filing Separately filing statuses.

Use the Head of Household Qualifying Tests table and the Who Is a Qualifying Person for the Head of Household Filing Status table to help you determine whether you qualify for this filing status.

Note: The, Who is a Qualifying Person for the Head of Household Filing Status, table is only for individuals that are not married

Head of Household Qualifying Tests

Not married Married but considered unmarried
You are not married on the last day of the year. You file a separate return.
You paid more than half the cost of keeping up ahome for you anda qualifying person for the tax year. You paid more than half the cost of keeping up a home for you and a qualfying child for the tax year.
You have a qualifying person who lived with you in your home for more than half the year (except for temporary absences, such as education or vacation).Your dependent parent does not have to live with you. Your spouse did not live in your home at any time during the last six months of the year.Your spouse is considered to live in your home even if temporarily absent due to special circumstances.
  Your home was the main home of your child, stepchild, or foster child for more than half the year.
  You must be able to claim a child, stepchild, or foster child as a dependent. (You can still meet this test if you cannot claim the child as a dependent only because the noncustodial parent is allowed to claim the child.)

Who Is a Qualifying Person for the Head of Household Tax Filing Status?1

If the person is your And Then, that person is
Parent, grandparent, brother, sister, stepbrother, stepsister, stepmother, stepfather, mother-in-law, father-in-law, half brother, half sister, brother-in-law, sister-in-law, son-in-law, or daughter-in-law You can claim them as a dependent2 A qualifying person
  You cannot claim them as a dependent Not a qualifying person
     
Uncle, aunt, nephew, or niece They are related to you and you can claim them as a dependent2, 3 A qualifying person
  They are not related to you3 Not a qualifying person
  You cannot claim them as a dependent Not a qualifying person
     
Qualifying Child They are single A qualifying person4
  They are married and you can claim them as a dependent2 A qualifying person
  They are married and you cannot claim them as a dependent Not a qualifying person5

1A person cannot qualify more than one taxpayer to use the Head of Household tax filing status for the year.

2If you can claim a person as a dependent only because of a multiple support agreement, that person cannot be a qualifying person.

3You are related   to an uncle or aunt if they are the brother or sister of yours or your spouse's mother or father.You are related by blood to a nephew or niece if they are the child of yours or your spouse's brother or sister.

4This child is a qualifying person even if you cannot claim the child as a dependent.

5This child is a qualifying person if you could claim the child as a dependent except that the child's other parent claims them under the special rules for a noncustodial parent.

For the tests a child must meet to be considered your qualifying child for the Head of Household filing status, please see Qualifying Child under the Dependents topic.

Note: Individuals that are using the "considered unmarried" rules to claim head of household must have a child, stepchild, or foster child for the relationship test.

Qualifying Widow(er) with Dependent Child

If you are a widow(er) and you have a qualifying child, you may be able to use this filing status. You must meet all of the following tests:

  • You qualified to file a joint return with your spouse for the year your spouse died. It does not matter whether you actually filed a joint return.
  • You must have provided more than half of the cost of upkeep for you and your dependent's main home during the tax year.
  • You have a child, stepchild, adopted child, or foster child who you can claim as a dependent.
  • You must not have remarried before the end of the tax year.
  • Your spouse must have died in either of the two years preceding the current tax year

Note: If your spouse died during the current tax year, you may qualify to use the Married Filing Jointly status.

Contact your neighborhood Jackson Hewitt office for more information or assistance. Use the Office Locator available on this Web site or call 1-800-234-1040 to find the Jackson Hewitt location most convenient to you.  The ruling provided a new definition for marriage at the federal level as a legal union between two individuals regardless of gender.  The new definition requires individuals of the same genderwho were legally married in a state, country or other jurisdiction to be recognized as legally married for federal purposes.  This ruling allows qualified taxpayers to amend their federal tax returns for all open years prior to September 16, 2013 and requires all taxpayers who are legally married to file as married taxpayers on federal tax returns for tax years beginning January 1, 2013.  For more information on the tax effects of the ruling contact your local Jackson Hewitt office to talk to a Tax Pro.