Head of Household vs. Married Filing Jointly: Which Tax Status is Right for You?

When it comes to taxes, picking the right tax filing status can make a big difference in what you owe or get back. Head of household and married filing jointly are common filing status options, and each comes with its own eligibility criteria. You can only qualify for one or the other, not both, so let’s break down each filing status and see which one may be best for you.

At a glance:

• You can only claim head of household filing status if you are unmarried.
• Filing as head of household gives you a higher standard deduction than as a single filer.
• Married filing jointly makes sense for many married couples, with a few exceptions.

Head of household

First, let’s break down the head of household status.

Eligibility criteria:

This status is for those who are single but have dependents. You qualify for head of household filing status if you’re unmarried (or considered unmarried for tax purposes) and pay more than half the cost of housing and support for a qualifying person — a child, parent, or other dependent — for over half the year.

The IRS considers you to be unmarried if:

• You haven’t lived with your spouse for the last six months of the tax year (temporary absences do not count)
• You paid more than half the cost of household expenses during the year (such as mortgage interest, rent, property taxes, utilities, repairs, food, etc.)
• Your home is the primary residence for your child
• You plan to file a separate return from your spouse

To qualify as your dependent, the person must be:

• A child under 19 at the end of the calendar year (or under 24 if the child is a full-time student)
• A parent, if you provide at least half of their support (they do not necessarily have to live with you)
• A qualifying relative, such as your grandparent or sibling, if you provide at least half of their support and they meet other criteria (as listed in IRS Publication 17)

Tax benefits:

People claim head of household status mainly because it gives you a bigger tax break. If you are unmarried, filing as head of household means you can claim a higher standard deduction than you would if you filed as single, meaning it reduces your taxable income more. For 2023, the standard deduction for head-of-household filers is $20,800 compared to $13,850 for single filers.

Scenario:

If you are a single parent raising a child on your own and footing most of the bills, you would likely qualify for head of household status, giving you a larger deduction than you would get as a single filer.

Married filing jointly

Now, let’s talk married filing jointly. This status is for married couples and allows them to file one combined income tax return.

Eligibility criteria:

Compared to head of household, the eligibility requirements for married filing jointly are pretty straightforward. To use this filing status, you simply need to be legally married by the end of the tax year and report your combined income with your spouse.

Tax benefits:

The main perk of married filing jointly is you only have to file one income tax return instead of two. This contrasts with married filing separately, where you would both file individual income tax returns.

In many cases, you will end up with less tax liability when filing jointly than if you filed as married filing separately. It can also open the door to more tax deductions and tax credits you would not qualify for if you filed separately, such as the Earned Income Credit or Child Tax Credit.

However, some exceptions exist where married filing separately may be more beneficial. We’ll go over some of those scenarios below.

Scenarios:

Let’s imagine you are legally married. Both you and your spouse work, but neither of you makes significantly more money than the other. You trust that your spouse is financially responsible and isn’t hiding any income. In this case, filing jointly as a married couple would probably be a good option for you.

Now, let’s say you and your spouse both work, but you have a much higher income and are in an entirely different tax bracket than your spouse. Your spouse had a lot of out-of-pocket medical expenses during the tax year. Since the IRS only allows you to deduct medical expenses exceeding 7.5% of your adjusted gross income (AGI), it may benefit you and your spouse to file separately. That way, your spouse’s AGI will be much lower than if you used your combined income, and they can claim a bigger tax deduction.

Lastly, if you are considering divorce or worried your spouse may be hiding something, it may be a good idea to file separately for your peace of mind. Just remember that both spouses must be on the same page when you choose to file separately. For example, if your spouse claims the standard deduction, you will have to do so as well — you won’t be able to itemize your deductions.

If you’re uncertain which filing status to choose, filing with us at TaxAct^® may be beneficial. We’ll ask you some interview questions and suggest the most beneficial filing status for your situation based on your answers.

Key differences between head of household vs. married filing jointly

Now, let’s recap the main differences between filing as head of household and married filing jointly:

• Marital status: If you’re unmarried with kids, you likely qualify for head of household status. If you are married, you don’t qualify for this status, but you could likely benefit from joint filing with your spouse.
• Dependents: Filing as head of household requires you to support a qualifying person, while married filing jointly involves filing with your spouse — it doesn’t matter whether you have dependents.
• Tax rates and deductions: Each status offers different tax rates and deductions. Head of household might mean lower rates and a higher standard deduction, while married filing jointly might open doors to different deductions and credits.

The bottom line

Choosing between head of household and married filing jointly boils down to your marital status and dependents. If you’re a single parent supporting one or more dependents, head of household might be right for you. If you’re married, and like the idea of filing your taxes together, married filing jointly could be the winning move.

We know tax rules can get messy, so if you’re still unsure, our tax prep software can help you pinpoint which filing status might be right for you.

This article is for informational purposes only and not legal or financial advice.

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