A few days ago I heard on the news that the number of unmarried couples living together in the US is increasing. Around tax time, these couples might wonder how to report their filing status.
If you are not legally married, then your filing status is NOT married filing jointly or married filing separately. If you live in a common law state and file your tax return as either, then the IRS is going to consider you married. This can create problems for you if being married is not your desire.
That leaves two filing status, Single and Head of Household (not discussing qualifying widow).
Scenario 1: You and your girlfriend live together (no kids and relationship does not violate local law)
1) You work & support both of you
2) Girlfriend does not work and has no income
Head of Household is a more desirable filing status than Single, but you do not qualify for it. In order to file Head of Household, you MUST pass three tests.
1) You are unmarried or “considered unmarried” on the last day of the year à PASS
2) You paid more than half the cost of keeping up a home for the year à PASS
3) A “qualifying person” lived with you in the home for more than half the year à FAIL
Here’s why you failed number 3. A qualifying person for the Head of Household status is either a qualifying child or a qualifying relative*. In this example, there are no children. What about qualifying relative? Well, your girlfriend would actually have to be related to you in a way listed by the IRS. By the way, cousins are not considered relatives, according to the IRS. So your filing status is Single. But, you can claim your girlfriend as a dependent!
Scenario 2: Same as above, but your girlfriend’s child lives in the household too
You pass the first two tests, but fail the third test again. Here is why you fail. The child is your girlfriend’s qualifying child, not yours. What about qualifying relative? Well to be a qualifying relative, a person cannot be a qualifying child of another person. So, your filing status is Single, but you can claim both your girlfriend and her child as dependents. You can only claim the child as a dependent because your girlfriend does not have to file a tax return and does not file or files only to get a refund from estimated tax paid.
*The definition for Qualifying Relative depends on the context that it is being used. In order to qualify a person for the Head of Household filing status, a Qualifying Relative must actually be related to the person in one of the ways listed by the IRS.
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