Separated? Do You Qualify as Head of Household?
March 25, 2016


Separated in 2015 – Do you Qualify for Head of Household Filing Status?

Head of Household When Separated
Knowing whether to file as head of household when separated is extremely important.

It is that time of year, again.  April 15 is fast approaching and parties who have separated during the prior tax year will be confronted with a number of decisions regarding their 2015 return.  One of the first decisions is the filing status that is selected.  This decision could impact significantly on the size of your refund or the amount of your tax liability.

The filing status selected determines the tax rate schedule that will be used in determining the amount of your tax liability.  There are four tax schedules to choose from –Married filing separately, Single, Head of household, and Married filing jointly.  If a decision has been made that Married filing jointly is not an option in your case, Head of household should be considered since after Married filing jointly, it will normally be the most favorable status for the taxpayer.  The question then becomes – do I qualify to file under the Head of household status which generally entitles the taxpayer to a higher standard deduction and lower tax rates?

Eligibility Requirements

The 2016  U. S. Master Tax Guide summarizes the eligibility requirements as follows:

  • The individual must be unmarried or considered unmarried at the end of the tax year; and
  •  Must maintain a household for which, for more than one-half of the tax year, is the principal of abode of a qualifying individual who is a member of that household.

These criteria may appear to be straight forward but determining eligibility requires a closer examination.  The first question that needs to be addressed is the meaning of “unmarried” or “considered to be unmarried”.  The IRC references the need to be either “unmarried” (that one is easy) or “legally separated” (more difficult to determine).  Some states have an actual decree of legal separation which fits the definition.  Pennsylvania does not have a decree of that type.  For the purpose of the Pennsylvania Divorce Code, parties are considered separated if they no longer reside together. But the Internal Revenue Service is not bound by state statutes so the question remains – does living in separate households satisfy the requirement of “considered to be unmarried”?  The Master Tax Guide provides some guidance indicating that a married taxpayer will be considered unmarried and eligible for head of household status if the taxpayer’s spouse was not a member of the household for the last six months of the year and if the household is the principal place of abode of a child for whom the taxpayer is entitled to a dependency exemption. (2016 U. S. Master  Tax Guide Section 173 page 142.)

Check with your Tax Preparer

Despite the Master Tax Guide’s delineation of what qualifies as “considered to be unmarried,” if you think that you might be eligible to file under this status, you should review your specific situation with your tax preparer, a CPA, or an enrolled agent versed in the subtleties of the Internal Revenue Code. And remember, marital status is not the only consideration in determining eligibility for this favorable status.  Be prepared to provide all relevant information about your situation.  Among other facts specific to your case be prepared to let your adviser know – the date you and your spouse ceased to reside together?  Is there an agreement as to which of you gets to claim the dependency exemption?  Is there a court order defining your custodial arrangement?  Are you following the court order?  If not, be prepared to demonstrate the amount of time the child or children spent in your home.

The Right Advice Can Save You Money

Based upon the above summary, you may be concluding that it is just not worth the effort and expense of obtaining expert advice.  However,  if having reviewed the above criteria, you conclude that you satisfy the basic requirements to qualify for Head of household status, the tax saving my well be worth the expense and effort  of obtaining the expert advice to determine if you qualify for this favorable filing status.

Tax and Divorce Assistance

At DZMM, we provide both tax and family law representation. Make certain you receive the advice you need so that you receive the benefits to which you are entitled. Contact us our Central Pennsylvania firm, today at 717-724-9821.