As a taxpayer, it is important to be honest and accurate when filing your tax return. Unfortunately, some individuals may attempt to take shortcuts by incorrectly claiming tax benefits they are not entitled to, especially when it comes to filing status. One common mistake, and potentially fraudulent action, is married taxpayers improperly filing as “Head of Household” for one spouse and “Single” for the other spouse to manipulate the tax system to get a higher tax refund. Do NOT do this. The IRS will catch up to you and you will owe a significant amount of back taxes.
Filing as “Head of Household” provides valuable tax benefits, including a larger standard deduction and more favorable tax rates. However, the IRS has strict guidelines about who qualifies for this filing status, and being married is not one of them—unless you meet specific criteria. Here is why you should avoid this route and file your taxes correctly.
What Does “Head of Household” Mean?
The “Head of Household” filing status is available to unmarried taxpayers who pay more than half the costs of maintaining a home for themselves and a qualifying dependent. This status is designed to provide a tax break for single parents or individuals supporting dependents.
Why Can’t Married Taxpayers File as Head of Household?
If you are married, you cannot claim “Head of Household” unless you have separated from your spouse for the last six months of the tax year and meet the other qualifications for the status. In other words, even if you live in separate homes, you must still be legally separated or living apart for a specified period. Simply being married, even if you live apart, does not qualify you for this status.
The Correct Filing Options for Married Taxpayers
For married taxpayers, the IRS allows two filing statuses:
- Married Filing Jointly: This is the most common and beneficial filing status for married couples. It combines both spouses’ incomes and deductions on a single return, usually resulting in a lower tax liability than filing separately. Joint filers also qualify for various credits and deductions unavailable to separate filers.
- Married Filing Separately: This option allows each spouse to file their own return and report only their individual income and deductions. While it may result in a higher tax rate and the loss of certain credits, it may be useful in specific situations, such as when one spouse has significant medical expenses, or the couple is legally separated, or they have a valid pre-nuptial agreement.
The Risks of Filing Fraudulent Tax Returns
Filing as “Head of Household” when you are married could be considered fraudulent, and doing so can trigger severe penalties. The IRS is vigilant about detecting incorrect filing statuses, and if they catch you, you could face hefty fines and interest on any unpaid taxes, and even criminal charges in extreme cases.
Additionally, if the IRS audits your tax return and determines that you filed fraudulently, they can disallow your deductions and credits, forcing you to pay back taxes, plus penalties and interest. In some cases, individuals convicted of tax fraud can face jail time.
The Bottom Line: Be Honest and Accurate
When it comes to filing your taxes, it is always best to be truthful and ensure your filing status is correct. Filing “Head of Household” while married is a mistake that can lead to costly consequences. Instead, opt for “Married Filing Jointly” or “Married Filing Separately,” depending on your situation. If you are uncertain about which filing status to use, consider consulting a tax professional or an attorney to avoid complications down the road. Remember, the IRS is there to enforce the law and protect taxpayers. Do not risk your financial future by attempting to file fraudulent returns. Stay honest, stay compliant.
If a tax preparer has scammed you into filing fraudulent returns, call me at (844)894-4440. We can help!
Author: Jenny L. Doling, Esq., LLM Taxation
CA State Bar Certified Bankruptcy Specialist
NACBA – Vice President
San Diego Bankruptcy Forum – Immediate Past President
Serving Bankruptcy Clients throughout California and
Tax Clients Nationally