Can You Claim Head of Household Filing Status?
Filing as head of household depends on three complicated criteria
Your tax filing status depends on your life circumstances, the most important being whether you're married. Other factors include whether you have dependents, and if you used to be married but your spouse is now deceased.
The Internal Revenue Code offers five different filing status options, and you must choose one of them when you complete your tax return. The head of household status is considered to be the most advantageous because taxpayers who qualify get a higher standard deduction and wider tax brackets compared to the single filing status. Numerous rules apply to qualifying, however.
You must be unmarried or "considered unmarried" at the end of the year to qualify as head of household. You must also have paid more than half the cost of maintaining your home for the year, and you must have one or more qualifying dependents.
The Head of Household Standard Deduction
Your filing status determines the amount of your standard deduction, as well as the tax rates you'll pay on your income. The head of household standard deduction for 2020 is $18,650, up from $18,350 in 2019.
Contrast this with single filers and married individuals who file separate returns—they can claim only a $12,400 standard deduction in 2020. Married taxpayers who file joint returns get a $24,800 deduction, but this works out to one $12,400 deduction for each of them, just as though they were single.
Head of Household Tax Rates
This table shows the tax rates that apply to head of household filers for tax year 2019, the tax return you'll file in 2020. Each segment of your income is taxed at the applicable bracket or percentage rate.
Head of household filers also get a break on the long-term capital gains tax rate. They don't jump to the 15% rate in the 2019 tax year until their taxable incomes exceed $52,750. It's just $39,375 for other unmarried taxpayers, and $78,750—again, double the amount for other single filers—for married taxpayers filing jointly.
The Unmarried Test
Normally, a taxpayer must be unmarried on the last day of the year to file as head of household. This means that you're single, divorced, or legally separated under a separate maintenance decree issued by a state court. But you can be "considered unmarried" if you're still legally married but you lived in a separate residence from your spouse for at least the last six months of the year—from July 1 through the end of December.
You must file a tax return separate from your spouse and you must still meet the other two criteria for head of household status if you qualify under the "considered unmarried" rule: the support test and the qualifying dependent test.
The Support Test
The support test requires that you provide more than half the cost of keeping up your home for the year. Qualifying costs include expenses like rent or mortgage interest payments, property taxes, property insurance, repairs, utilities, and groceries. Taxpayers can use Worksheet 1 in Publication 501 to determine if they meet the support test.
Unfortunately, costs associated with clothing, education, medical care, vacations, life insurance, and transportation don't count toward this test. The principal portion of your mortgage payment isn't a qualifying cost, either.
This doesn't necessarily mean that you have to be the only adult living in your household. You can still have a roommate to help defray costs, but you must personally pay at least 51% of the household expenses. You won't qualify for head of household if you scissor expenses neatly and exactly down the middle.
Income received from public assistance programs such as Temporary Assistance for Needy Families doesn't count toward financial support provided by a taxpayer for purposes of qualifying for head of household filing status. If you used funds from any of these sources, you can't include it as money you personally paid toward supporting your household.
The Qualifying Dependent Test
A qualifying person must live in your home for more than half the year, and this is the most complicated rule of all. Only certain closely-related relatives can be qualifying persons for the head of household filing status. They include:
- Your child, stepchild, adopted child, foster child, brother, sister, or a descendant of one of these individuals whom you claim as a dependent under the qualifying children rules
- Your child, stepchild, adopted child, foster child, brother, sister, or a descendant of one of these individuals whom you could claim as a dependent under the qualifying children rules, but you've elected not to claim him as a dependent because you released the right to claim the child as a dependent to the noncustodial parent
- Your mother or father who can be claimed as your dependent under the qualifying relative rules
- Your brother, sister, grandparent, niece, or nephew whom you can claim as a dependent under the qualifying relative rules.
The IRS provides a well laid-out chart regarding qualifying persons in Table 4 of Publication 501.
Exceptions to the Rules
A taxpayer and his qualifying dependent are considered to reside in the same household during periods of temporary absence if the absence is due to "illness, education, business, vacation, or military service," according to the IRS. The rule states that:
"It's reasonable to assume the absent person will return to the home after the temporary absence. You must continue to keep up the home during the absence."
In other words, if your child lives away at school for a portion of the year, they still qualify.
There's also a special exception for people who support their dependent parents. A parent can be a qualifying person for purposes of meeting the residency test even if they doesn't reside in your home, as long as you can claim them as your dependent and you meet the support test. The IRS says in Publication 501:
"If your qualifying person is your father or mother, you may be eligible to file as head of household even if your father or mother does not live with you. However, you must be able to claim your father or mother as a dependent. Also, you must pay more than half the cost of keeping up a home that was the main home for the entire year for your father or mother."
You'd also meet the qualifying dependent test if you paid more than half the cost of keeping your parent in a home for the elderly or a rest home.
Can Two Spouses Both Qualify? An Example
It's possible that two taxpayers who used to be married to each other could each qualify as head of household due to the complexity of these rules—assuming they're divorced as of December 31 of the tax year, or they haven't lived together from July 1 onward.
For example, Mary might maintain her own residence, and the child she and John share lives with her throughout most of the year. She claims the child as her dependent. She has a roommate to help her make ends meet, but the roommate only contributes about a quarter of the household's annual expenses. Mary pays the other 75%.
Mary qualifies as head of household. She meets both the qualifying dependent test and the support test. She and John are "considered unmarried" under IRS rules because she and John broke up and moved into separate residences on June 1, and they never lived together after that point.
As for John, he lives alone. He pays 100% of his household expenses, and he also paid half the annual cost for his mother to live in a nursing home. John also qualifies as head of household. He's considered unmarried and he meets both the support test and the qualifying dependent test because he provides for his mother.
Tools for Determining Filing Status
The IRS has a filing status application on its website. It takes about five minutes to complete and it can help you determine the filing status for which you qualify. Most tax preparation software will ask you a series of questions and determine your filing status for you as well.
Internal Revenue Service (IRS). "Correct Filing Status." Accessed April 3, 2020.
Internal Revenue Service (IRS). "Publication 501 (2018), Dependents, Standard Deduction, and Filing Information: Head of Household." Accessed April 3, 2020.
Internal Revenue Service (IRS). "IRS Provides Tax Inflation Adjustments for Tax Year 2020." Accessed April 3, 2020.
TaxFoundation.org "2019 Tax Brackets." Accessed April 3, 2020.
Internal Revenue Service (IRS). "Publication 501 Dependents,Standard Deduction, and Filing Information," Page 9. Accessed April 3, 2020.