Taxpayers who do not consider how changes to their life impact changes to their tax situation are leaving themselves open to array of mistakes, the consequences of which could be severe. If you are separated from your spouse, you may be able to file single on your tax return, then again you may not. It all rests upon whether or not your separation from your spouse is considered a legal separation.
Each year that you file taxes, the first decision you are required to make is the selection of a filing status. You must make the filing status selection even before you decide whether or not you will file a return because income filing requirements are tied directly to filing a taxpayer's filing status. If you are separated from your spouse and wondering whether you can file single, the first question you need to ask yourself is whether, for the purpose of taxation, you are considered married or unmarried.
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Unmarried or Married
You can only file single on your return if you are considered single on the last day of the tax year. In order to be considered married, you and your spouse must be living together as husband and wife, living together in a common law marriage recognized by your state, married and living apart but not legally separated, or married but separated under a divorce decree which is not final on the last day of the tax year. If none of these conditions are met, then you and your spouse are considered unmarried at the end of the tax year and have the choice between filing single or head of household. Generally, only couples who are legally separated under state law can file single.
If you and your spouse do not fit the criteria to be considered unmarried, then you still have the option of filing separate returns. Filing married but separate returns only requires one spouse's signature and separates your tax accounts for the year in which you're filing. This means that if your spouse owes tax for that year, then you will not be held responsible and vice versa. Compare this to a joint filing where both parties are held jointly responsible for the accuracy of all the information listed on the return. Joint liability is known as "joint and several" liability and sets the standard that the IRS can pursue both spouses for any tax due as a result of the return both separately and jointly, even if the taxpayers are later divorced.
Your filing status can sometimes deem you ineligible for certain credits and deductions. For instance, married filing separate filers are ineligible to claim the Earned Income Credit or the Child and Dependent Care Credit, just to name a few. In addition, the tax rate varies depending on a taxpayer's filing status. Although some separated taxpayers can file single, filing head of household is a much more advantageous filing status than single because of the lowered tax rate. In order to file as head of household, a taxpayer must have paid at least half the household expenses during the year and have a qualifying person to claim on their tax return.