Knowing the ins and outs of filing your taxes can save you substantial amounts by boosting your tax refund. One often overlooked factor on your taxes is your filing status. If you’re not married and you automatically file as single, you could be overpaying your taxes if you’re eligible to file as head of household. If you take care of someone else, such as if you’re a single parent or if you’re taking care of an aging parent, knowing the difference between filing single and head of household ensures you’re not overpaying at tax time.
Filing single and filing as head of household come with different standard deductions, qualifications and tax brackets. You qualify as single if you're unmarried, while you qualify as head of household if you have a qualifying child or relative living with you and you pay more than half the costs of your home.
Qualifications for Filing Statuses
If you are unmarried at the end of the year, your default tax filing status is single. However, if you meet certain criteria, you can file your taxes using the more advantageous head of household status. To qualify, you must pay more than half the cost of keeping up a home during the year and a qualifying person must live with you for more than half the year.
When calculating the costs of keeping up a home, you can include housing expenses like rent, mortgage, utilities, real estate taxes, repair, home insurance and food eaten at home. However, you can’t include the cost of clothing, education, healthcare or transportation.
A qualifying person must be someone who meets the criteria for you to claim as a dependent under either the qualifying child or qualifying relative tests. If the person meets the criteria to be your qualifying child, the person counts as your qualifying person if he or she is single or if he or she is married and you actually claim an exemption for him or her.
If the person meets the criteria as a qualifying relative, that person counts as a qualifying person if it is your parent and you can claim an exemption for him or her. If it’s not your parent, the person must be related to you, must live with you for at least half of the year and you must be eligible to claim an exemption for him or her for the person to count as a qualifying person for the purpose of filing as head of household.
One significant difference between filing as single versus as head of household is the amount of your standard deduction. For the 2018 tax year, the standard deduction is $12,000 if you’re single but $18,000 if you file as head of household. The standard deduction will only apply if you decide not to itemize on your tax return.
The tax brackets for each filing status are also different. For example, in 2018, singles pay 10 percent on their first $9,525 of taxable income. Heads of household pay 10 percent up to $13,600. The 12 percent tax bracket runs from $9,525 to $38,700 for singles, but $13,600 to $51,800 for heads of household. That means that heads of household will pay less in taxes on the same amount of income than someone filing as single.
- Internal Revenue Service: Publication 501 - Introductory Material
- IRS: Publication 17
- IRS: Itemize or Choose the Standard Deduction
- The Tax Foundation: 2018 Tax Brackets
- Legal Information Institute: 26 USC 2
- Internal Revenue Service. "Publication 501: Dependents, Standard Deduction, and Filing Information," Pages 6, 8. Accessed Feb. 10, 2020.
- Internal Revenue Service. "IRS provides tax inflation adjustments for tax year 2020." Accessed Feb. 17, 2020.
- Internal Revenue Service. "Choosing the Correct Filing Status." Accessed Feb. 10, 2020.
- Internal Revenue Service. "Publication 501: Dependents, Standard Deduction, and Filing Information," Page 8. Accessed Feb. 10, 2020.
- Internal Revenue Service. "Publication 501: Dependents, Standard Deduction, and Filing Information." Pages 8-9. Accessed Feb. 10, 2020.
- Internal Revenue Service. "Publication 501: Dependents, Standard Deduction, and Filing Information," Page 2. Accessed Feb. 10, 2020.
Based in the Kansas City area, Mike specializes in personal finance and business topics. He has been writing since 2009 and has been published by "Quicken," "TurboTax," and "The Motley Fool."