How Does Filing Status Affect My Tax Refund?

What are your tax filing status options?

There are five tax filing statuses:

• Single
• Married Filing Jointly
• Married Filing Separately
• Qualified Surviving Spouse
• Head of Household

There’s a small chance that you might qualify for more than one filing status if you’re married, your spouse has died, and whether you have dependents or not. But it’s best to go with the status that could offer the maximum deductions and credits you qualify for.

How do you determine what IRS tax filing status you are?

The easiest way to understand what your filing status is by determining what your marital status is on the last day of the year. For example, if you get married in July, and are still married on December 31 – your filing status for the entire year can be married filing jointly, even though you were single for the first half of the year. That goes for those getting a divorce, too. If you divorce on the last day of the year, you’re considered “single” for the whole year. Even if married or divorced at 11:59 pm. on December 31 (near but not past midnight), counts for the whole year.

Single filing status is for unmarried people. Simple as that.

Married filing jointly is the most common filing status for married couples. This status has the highest standard deduction and some of the most beneficial tax rate brackets. You file together and report combined income, along with your combined deductions and qualifying credits on the same form. This way, the IRS holds both spouses accountable for all taxes due, including penalties and interest.

Important tax tip: If filing married filing jointly, you each are responsible for the total taxes – not just yours –so if you have concerns, it’s best to see a tax expert about some other choices you might have, including married filing separately.

Married filing separately is another option for married people to file. Though filing jointly is best in most cases, there are some situations when filing separately works out better – meaning possible lower taxes or other benefits you might want. Like married filing jointly status, most things are simply added together on a Married filing jointly tax return. But, if you and your spouse have vastly different income levels or vastly different deductions individually, this might create a tax reduction opportunity and lower taxes by filing married filing separately. On a high level, this could be beneficial for those who have big differences in their earnings and expenses situation.

A few things to keep in mind about this status:

• It holds only the taxpayer on the return responsible for any taxes due and penalties and interest, not their spouse.
• It’s for people who don’t want to file a joint return, or whose spouse refuses to file a joint return--meaning you are not willing to file together. This is most common for those going through a divorce or separation.
• It potentially has the highest tax rate brackets, fewest allowed credits and deductions (for example, you can’t claim the Earned Income Tax Credit, American Opportunity Tax Credit, Lifetime Learning Credit, or the Child and Dependent Care Credit). It can also make more income taxable in many circumstances, such as for Social Security benefits.
• It also reduces your standard deduction amount to zero if the other spouse is itemizing deductions. As I said, it is not for everyone but does have a place in the tax ecosystem. If you’re interested, talk with a Tax Pro, and do not elect for this status alone without knowing all the details.

Qualifying surviving spouse is for people who have recently lost a spouse and are supporting a dependent child at home who is under 19, or 24 if they’re a full-time student or disabled. But, if your partner passed away in the same tax year, you could still file as married jointly for that year. It’s generally best for the next two years to choose the qualifying surviving spouse status if you have a dependent child.

Head of household is for unmarried people who provided at least half of the cost to maintain a home for the year, while also providing more than half the support to at least one other person for more than six months of the year. The main benefits of this filing status are a higher standard deduction and more taxable income falling into lower tax brackets.

• Two examples of those who can claim themselves as head of households: single parents who have a child living at home, and adults who provide support to their elderly parents or relative under qualifying circumstances.

Some single taxpayers can file as head of household. Sometimes, no one provides more than half of the support of an individual. When this happens, a person who provides more than 10% of the support can claim the individual as a dependent by agreement. This filing status can be complex, so talk to a Tax Pro before making the final decision.

Does my filing status impact what tax deductions and credits I can claim?

Yes. One of the biggest things your filing status impacts is what your standard deduction amount is. The standard deduction is a flat amount that reduces the amount of income on which you're taxed.

You can’t take the standard deduction if:

• You are married, but filing separately, with a spouse who itemizes deductions.
• You are an individual who files a tax return for less than 12 months because of a change in your annual accounting period.
• You are filing as an estate or trust, common trust fund, or partnership.
• You were a nonresident alien or a dual-status alien during the year.

Furthermore, there are dozens of tax credits that have different requirements and the credit size amount. Many of them change, based on your filing status itself. For example, if you are eligible for the Earned Income Tax Credit, the amount you can get changes if you’re single or married.

If you try to claim a credit or deduction under the wrong filing status, it can cause a delay in the IRS processing your return and in receiving your refund.

What are the 2023 tax brackets and rates?

Tax brackets and rates adjust each year for inflation. But at a high level, there are seven federal income tax rates, meaning this is the percentage of your income you need pay: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. Depending on your filing status, the tax brackets and rates are based on your total taxable income. 

Commonly asked questions about filing status options

Can I file head of household if I’m married?

Sometimes. You just must meet several requirements, like paying more than half of household expenses and you haven’t lived together for the last six months.

Can I change my tax filing status at any time?

Yes, if you meet the requirements for that unique filing status.

Can I file married filing separately if I’m still living with my ex-spouse?

Yes. You just need to meet the other requirements and decide if this is a better option for you and your spouse.

How do I change your filing status?

All you must do is update your W-4 Form with your employer.

What do I do if I filed under the wrong filing status?

File an amended return to correct the error. This could change your refund amount from that year – either by getting a bigger refund or having to pay back the IRS with money you weren’t supposed to get.

Will I pay a penalty for changing your filing status?

No, there is no penalty for changing status, but your tax refund amount could change.

About the Author

Mark Steber is Senior Vice President and Chief Tax Information Officer for Jackson Hewitt. With over 30 years of experience, he oversees tax service delivery, quality assurance and tax law adherence. Mark is Jackson Hewitt’s national spokesperson and liaison to the Internal Revenue Service and other government authorities. He is a Certified Public Accountant (CPA), holds registrations in Alabama and Georgia, and is an expert on consumer income taxes including electronic tax and tax data protection.

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