Head of household is one of the most complicated filing statuses out there. As such, taxpayers often claim it incorrectly or overlook it altogether.
What is the IRS Definition?
The head of household filing status is for individual taxpayers who are single or unmarried and keep up a household for a qualifying person. The IRS defines keeping up a household as paying for more than half the costs of maintaining a household that serves as your primary residence. According to the IRS, a qualifying person is someone who has lived with you in that home for at least half of the year, with only temporary absences. In most cases, a qualifying person is a dependent child, but it can also be a parent.
Should I File as Head of Household?
If you meet all of the requirements for filing head of household, it could be a good option for you. It will definitely allow you to have a lower tax rate, and you will have a higher standard deduction than if you choose the single filing status. However, you need to be careful when selecting this filing status, as a mistake could trigger an IRS inquiry or an audit.
If you want to know more about whether or not you can qualify for head of household, get in touch with Taxation Solutions, Inc. Our experienced tax help professionals have extensive experience helping Austin-area residents with tax issues of all varieties, and we can’t wait to use our expertise to help you!