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Head of Household Filing Status Qualifications vs. Single – IRS Tax Filing for Single Parents

By David Bakke

single man sonRestarting life after divorce as a newly single parent can really take its toll on you emotionally, mentally, and financially. Similarly, having a child with someone you never married, and are no longer in a relationship with, can be equally difficult. If you’re in one of these situations, your tax filing status is probably one of the last things on your mind.

However, you can’t ignore this important issue: filing your taxes with the most beneficial status for you can lead to a significantly larger tax return. As someone who recently divorced and is now a single parent, I can tell you that every penny counts! Take the time to research your tax filing status thoroughly and you will be able to ease at least a small portion of your financial worries.

Once you’ve decided to evaluate your tax filing status, the next logical question is whether it is better to file as single or head of household. The answer is simple – you either qualify for one status or the other. There is no decision-making process.

Since I recently got divorced, I had to determine which filing status applied to me. As it turns out, for last year, I qualified for head of household. Had I not done my research and realized that I qualified, I would have left a lot of money on the table by filing as single (most likely, the IRS would not have notified me since the error would have been in their favor).

To help ensure you don’t make that mistake, I have outlined the qualifications and benefits for each status below:

Importance of Filing Correctly

Before we get into the hows and whys of single and head of household status, I want to mention three key points:

  • Keep Your W-4 Up to Date. If you are a newly single parent, according to the IRS, you must submit an updated W-4 form with your employer within ten days of your divorce being finalized. This will help keep your federal income tax withholding accurate.
  • Your Status Carries Over. Your legal, marital status on the last day of any tax year will basically determine your filing status for that entire year. If you were divorced on December 31 of last year, then you are considered divorced for the entire year in the eyes of the IRS.
  • You Don’t Want to Screw This Up. Believe me, even though you may consider yourself to be the “head of the household,” you may not be under the rules of the IRS. Make sure you do your research and get it right the first time. It’s not like you can file your taxes with an incorrect status and wonder if the IRS will ever figure it out. By filing under an incorrect status, you risk having your entire return rejected by the IRS, or being subject to additional taxes, interest, and penalties.

Basically, while filing incorrectly could help you out in the immediate future, if it’s done wrong, it could become costly over the long run. Keep these points in mind as you read on.

Filing as Single – Qualifications

As far as figuring out if you qualify as a “single” person, the guidelines are pretty straightforward. According to the IRS, your filing status is single if, on the last day of the year, you are unmarried or legally separated from your spouse under a divorce or separate maintenance decree, and you do not qualify for another filing status.

Benefits

I’ll be honest with you – you would be hard-pressed to find any significant financial benefits to filing as single, especially if you were divorced and will now lose out on your ex-spouse’s tax deduction. This is one of the reasons why you need to make sure that you don’t qualify for the head of household status discussed below. If you don’t, then you have no other choice than to file as single.

But, if you do have to file as single, there is a silver lining:

  • Simplified Returns. Your return should be much easier to compile. You might even be able to use the 1040-EZ form rather than the standard 1040 tax form. This means you could utilize free online tax preparation software and services.
  • Less Paperwork to Dig For. Additionally, you can look forward to a less complex return as you are only filing your taxes based upon your own personal tax documents. This means less research and less document gathering. Trust me, this could be a big benefit if you are recently divorced and are not on the greatest terms with your ex-spouse.

Filing as Head of Household – Qualifications

The rules for being eligible for head of household are complicated, extensive, and very specific. In fact, they are so specific that I am not able to outline every single qualifier in this article. I strongly encourage you to talk to your accountant or visit the IRS website before determining your filing status.

In a nutshell, here are the qualifications:

1. Dependents

You must have a qualifying dependent who is related to you and also meets the requirements to be either a “qualifying child” or “qualifying relative.”

  • Qualifying Relative. In order to be considered a qualifying relative, that person must not meet the requirements as a qualifying child or relative of anyone else. Their gross income must be less than your federal exemption amount for that year, and you must have had provided more than half the support of that person during the calendar year.
  • Qualifying Child. The person must be under 19 years of age, or a full-time student under the age of 24. They must have lived with you for more than half the year and not have provided for more than half of his or her own support.

2. Housing Costs

You must also pay more than half the costs for the maintenance of the home in which you and your qualifying dependent lived for more than half the year.

To illustrate a little more clearly, I found that I qualfied for the head of household status because I was divorced late last year and therefore paid for more than half the support of my son (my qualifying child) for the calendar year. He did not meet the requirements as a qualifying child for anyone else, and also lived with me for more than half the year. Unfortunately, I will not be able to qualify for head of household next year, as my son won’t be living with me for more than half the year.

In very limited instances, you may qualify to file as head of household even if you are still legally married.

Benefits

In short, although it may be much more difficult to decipher whether or not you qualify for head of household, if you do, the tax breaks are significant. Here are a couple of ways you’ll benefit:

  1. Higher Standard Deduction. The standard deduction for head of household is much higher ($8,500 for head of household vs. $5,800 for single filers).
  2. More Favorable Tax Rates. You get more favorable tax rates because, as a head of household filer, you qualify for lower tax brackets (depending on your income) than you would if you filed single.

Ultimately, with these benefits, it is clear that filing as head of household is a much better option than filing as single.

Final Word

I am recently divorced as I mentioned, and the dramatic effect it has had on virtually every area of my life has been tremendous. Regardless of this, now is the time that I need to keep my “eye on the ball” when it comes to my finances.

The cost of my monthly child support check is significantly higher than what my actual costs were to raise my child. There’s nothing I can do about that, however. What I can do is take charge of saving some dough in every other area of my life – whether it be groceries, car insurance, utility bills, or taxes.

Be sure to investigate the matter thoroughly. If you do qualify for head of household status, then file that way!  Your benefits are sure to be worth the effort.

What are your thoughts on filing single vs. filing head of household?

(photo credit: Shutterstock)

David Bakke
David started his own personal finance blog, YourFinances101, in June of 2009 and published his first book on ways to save more and spend less called "Don't Be A Mule..." Since then he has been a regular contributor for Money Crashers. He lives just outside Atlanta, GA and most all of his free time is taken up by his amazing three year old son, Nicholas.

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  • Anonymous

    My spouse and I just file our taxes this year separately because we are separate but not divorce yet. My spouse claim the boy and I (wife) claims the girl. With two kids, we don’t have the money for the divorce papers. My daughter and I are now living with my parents. We both filed as head of household. Should this be a problem for us, if we get audit? and after a divorce can we still live together for the sake of our kids? Thank you.

    • Davidbakke

      Lee:

      Two people can file as head of household that live at the same address in some cases, but there are lots of restrictions and exclusions. I’d consider consulting with a tax professional for your situation.

  • mom92

    Husband left home on Dec. 14, 2012. Can I file head of household for 2011 taxes. I have two dependents.

    • Davidbakke

      I believe you need to live apart from your husband for at least six months of the prior year. and other restrictions do apply. You may want to contact a professional to follow up. Hope that helps and thanks for commenting

  • HopeMarie and Jerry Modlin

    Do you work too? or do you rely on your ex’s income soley?

  • HopeMarie and Jerry Modlin

    I am a single parent too and had to pay child support for my child who takes care of himself at 17 while his dad sat at home and complained about being broke.. not to mention ALIMONY

  • Stan

    Situation:
    Divorced w/2 kids. I claim one of the children as a decution and the ex claims the other. This is per our divorce paperwork.

    Question:
    Can we each qualify as head of household given we each claim one of the kids, assuming each of us have our claimed child for more than 1/2 the year? Or is the filing status limited to only 1 of the parents of divorce?

  • http://profile.yahoo.com/6JBF4TLKIQYY2C7WARXRZFNM3U Kristen

    I will be getting married next year and have been head of household for sometime with just my son and I. Will getting married keep me from getting EIC and getting as good of a return back as I usually would? And would it prevent me from getting the child care credit? My husband to be makes only about 30,000 per year. And I make less than that so Im not sure how that would work! Any help would be appreciated!

    • Davidbakke

      Kristen

      Thanks for writing. On its face, it would seem like you can still take the EIC, depending upon your AGI and your new filing status. You must also file as Married Filing Jointly to get the child care credit, as I understand it. However, your best bet is to speak with a qualified tax professional before moving forward. Good luck, and I hope that helps.

  • disqus_NcxNndbly8

    There is major controversy on claiming head of household. A couple years ago I lived with my parents with my then 3 year old daughter. I was 25. I’m unmarried and am the custodial parent.

    My parents of course couldn’t claim me. I was told I should have filed head of household because I have a dependent, paid over half the cost that didn’t include the cost of my parents home but for my own household(my daughter and I) but since my parents couldn’t claim me, made it grounds to claim head of household.

    What are your thoughts on this unique situation?

  • Bobbie Jo

    I have been divorced for over a year, our 21 year old son leaves with me full time, is going to school full-time and works, he made about $10,000 last year. I pay all the bills to maintain the house, can I file Head of Household and claim my son. If so, what does he need to file?

    • crystal

      when you file your taxes and claim your son, and when he goes to file his taxes then it will decrease the amount of taxes he gets back on his return. My uncle claimed me one year and it cost me over $300 in taxes from my return. it sucked.

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