August 5, 2022
head of household

Do you provide over half the cost of living for your household? You may want to consider filing your taxes as head of household, which could qualify you for a higher standard deduction. Head of household filing status also provides lower tax rates than filing as single or married and filing separately.

How can you qualify as Head of Household?

There are a few qualifying criteria to meet in order to file under head of household status:

  1. You must be single, divorced, or separated by the last day of the tax year.
  2. You are responsible for over half of your household’s living expenses.
  3. You have a child or qualifying dependent.

What kind of expenses are you responsible for as the Head of Household?

Taking responsibility for living expenses includes, but is not limited to:

  • Rent or mortgage
  • Utility bills
  • Insurance
  • Property taxes
  • Groceries
  • Repairs
  • Other household bills (internet, phone, etc.)

As head of household, you are required to be responsible for the listed expenses for over half of the tax year.

If your dependent is a parent, they are not required to live in the same household as you. The stipulation is that you maintain their cost of living. It’s important to note that if you are married and living in separate households, this does not qualify you for Head of Household status. You must be unmarried.

What does the IRS mean by “unmarried?”

Unmarried means that you’re filing a separate return and your spouse didn’t live with you for the last half of the year. Two people cannot file as head of household on the same return.

If you share a child (biological, stepchild, or foster) with your former spouse, your home should be the primary residence of the child to qualify for head of household status. If you are unable to claim the child as a dependent, this could make qualifying a bit more difficult.

Pros of filing as Head of Household

This filing status offers a better standard deduction amount than most others, even with a lower tax bracket. The deduction may not be as favorable as joint filing, but it’s a considerably larger deduction than filing single by roughly 50%. The standard deduction for 2021 head of household status was $18,800.

Tax debt and filing assistance for Head of Household status

Tax debt with the weight of other financial burdens can be a stressful ordeal. As a head of household filer, you may qualify for relief. Give Optima a call for a free consultation today at 800-536-0734.

Received an IRS notice? Try out the Optima Tax App to analyze your notice in the palm of your hand.