Filing Your Tax Return – 2018 Tax Year
I know we are just coming out of the holiday season, and you probably don’t want to think about taxes already. After all, you have until April 16 to figure out what you are going to do to meet the April 17, 2018, deadline for filing your 2017 personal tax return.
But, bear with me. Do a little bit of thinking just in case you are one who likes to get a jump on things and are planning to file your tax return as soon as you get your W2s and 1099s.
There are five choices for filing status on your federal return: Single, Married Filing Jointly, Married Filing Separately, Head of Household, and Qualifying Widow(er) with Dependent Child. Your filing status is used to determine standard deductions, eligibility for certain credits and deductions, and even the amount of tax you pay.
Most of us think that if we’re married, we file, jointly; if not married, we file single. And head of household is a term most don’t understand. But for many who haven’t thought about it, now’s a good time—before the panic of the filing season descends. Sometimes you have a choice in filing status. Sometimes you do not. Here are several things you need to know about filing status.
Last day of the year. Your marital status on the last day of the year determines your marital status for the entire year. So to be eligible to file a “married filing joint” return, you must be married on December 31st, 2017.
Divorced or Legally Separated. If you are legally divorced during 2017 you must file single. If you are legally separated under state law, you can also file using single status. But if you are still married on December 31st and not legally separated, you’ll need to file as married (presumably filing separately, not jointly), not as single.
Doubling Up. If more than one filing status applies, you can pick the one that gives you the lowest tax. For most people, if you and your spouse pay lower taxes by choosing married filing jointly, you should. But sometimes that may not make sense.
Death of Spouse. If your spouse died during the year and you did not remarry during that year, usually you may still file a joint return with that spouse for the year of death.
Concerned about Shared Liability with your Spouse? By filing jointly with your spouse, each of you is 100% liable, regardless of who had the income. If you later learn your spouse had unreported gambling winnings, watch out. You may be able to claim innocent spouse relief. However, you might avoid these issues entirely by choosing married filing separately. If you’re worried about liabilities between spouses and are concerned about your spouse’s tax debts, think carefully, and get our advice.
Head of Household? This status generally applies to taxpayers who are unmarried. You may qualify for this filing status even if you are married but have been separated for the last 6 months. You must also have paid more than half the cost of maintaining a home for you and a qualifying person.
Qualifying Widow(er) with Dependent Child. You may be able to choose this as your filing status for 2017 if your spouse died during 2016 or 2017, you have a dependent child and you meet certain other conditions.
You can also use the Interactive Tax Assistant on the IRS website to determine your filing status. The ITA tool takes you through a series of questions and provides you with responses. Most people don’t devote any thought to their filing status, and that can be a mistake. If you have any questions about your filing status options, contact the Sodowsky Law Firm at 703.457.1321 to schedule a confidential meeting to explore your options.
