Tax Filing Status

Knowing your tax filing status is very important. The IRS will reject your tax return filing if you file with an incorrect tax filing status. This is because each tax filing status has different levels of tax deductions, tax credits and tax exemptions allowed. Filing your tax return using tax filing status that you don't qualify for may result in larger tax deductions, tax credits or tax benefits that the IRS will penalize. On the other hand, if a taxpayer files using a tax filing status that is less beneficial than the tax filing status that they qualify for, then they will owe more taxes to the IRS than they should. While the IRS will not penalize a taxpayer for filing using a less beneficial tax filing status, it will not avoid an IRS audit if your tax return is chosen.

Some taxpayers mistakenly think that if they file using the least beneficial tax filing status, don't claim any tax deductions or tax credits and don't get any tax exemptions, the IRS will favor their tax return and will not audit them. This is not true. Any tax return can be audited and yes sometimes a taxpayer is audited and gets tax refunds from the IRS as a result of the audit. This does not happen often but it does happen. So, file your tax return using the correct tax filing status to avoid any problems.

There are five tax filing statuses; single, married filing jointly, married filing separately, head of household and widow(er) with dependent child.

• Single taxpayers can file as either
  • Single, or
  • Head of Household
• Married taxpayers can file as either
  • Married and filing separately, or
  • Married and filing jointly with your spouse, or
  • Head of Household
• Qualified Widow(er) with dependend child
  • Single
  • Married filing separately
  • Married filing jointly
  • Qualifying widow(er) with dependent child
  • Head of Household

If you are single, then you can file as a single taxpayer but you may also be qualified as a head of household if you are supporting a qualified dependent. If you are married, then you can choose to file your tax return separately from your spouse or file jointly with your spouse. Filing jointly allows many more tax benefits than filing separately. When deciding which tax filing status a taxpayer is qualified to use, the definition of a dependent is key because just because a taxpayer has a child does not mean that child is considered a dependent child by the tax laws. There are two types of qualifying dependents; qualifying child and qualifying relative including relatives who do not have to live with taxpayers.