How Does the IRS Know If You Are Married?

A taxpayer’s marital status is important information for the Internal Revenue Service because it influences filing status, tax brackets, and eligibility for various deductions and credits. The IRS does not maintain a real-time database of every citizen’s marital status. Instead, it determines this status using information provided by taxpayers and through data-matching programs with other government agencies.

The IRS Definition of Marriage for Tax Purposes

The IRS uses the “last day of the year rule” to determine marital status for an entire tax year. If you are married on December 31, you are considered married for the whole year. This means a couple who weds on New Year’s Eve is treated the same as a couple married for several years. If a final decree of divorce or separate maintenance is issued on or before the last day of the year, you are considered unmarried for the entire year.

State law is the authority on whether a marriage is valid. The IRS recognizes any marriage that is legally established in the state where it was performed. This recognition extends to moving; if a couple is legally married in one state and then moves to another, the IRS continues to view them as married for federal tax purposes.

This reliance on state law includes common law marriages. If a state’s laws recognize a common law marriage as a valid legal marriage, the IRS will also recognize it, even if the couple later moves to a state that does not. For federal tax purposes, the term “marriage” does not extend to registered domestic partnerships or civil unions.

If a spouse passes away during the tax year, the surviving spouse is considered married for that entire year. This allows them to file a joint return for the year of death. This determination is an exception to the December 31 rule.

Information You Directly Provide to the IRS

The most direct way the IRS learns of your marital status is from the tax return you file. On Form 1040, you must select a filing status, and choosing “Married Filing Jointly” or “Married Filing Separately” is a declaration of your marital status. This selection is the primary information the IRS uses to calculate your tax liability.

On Form W-4, you provide your marital status to your employer to determine the correct federal income tax withholding. While this form goes to your employer, the wage and tax information they report to the IRS on Form W-2 is influenced by the status you claimed.

If you get health insurance through the Health Insurance Marketplace, your marital status is reported during the application. This information is sent to the IRS on Form 1095-A, which the agency uses to reconcile premium tax credits. A discrepancy between the status reported to the Marketplace and on your tax return can trigger IRS questions.

Information the IRS Receives from Other Sources

A significant source of this indirect information is the Social Security Administration (SSA). The IRS and SSA have data-matching programs. When an individual gets married and changes their last name with the SSA, that information is part of the data shared with the IRS, which can then be cross-referenced with the name and filing status on a tax return.

Many state tax agencies also have information-sharing agreements with the IRS. If you file a state income tax return using a “married” filing status, that information can be shared with the federal government. The IRS can use this data to verify the consistency of your filing status between your state and federal returns.

Other federal agencies that administer benefits or programs often require applicants to provide their marital status. This information can be made available to the IRS through various inter-agency programs designed to verify eligibility and prevent fraud, providing another point of comparison for automated systems.

Consequences of an Incorrect Filing Status

If the IRS identifies a mismatch between your filing status and its information, it can lead to consequences. The process often begins with an automated notice, like a CP2000, which is sent when information on file doesn’t match a tax return. This notice proposes changes to the tax owed and requires a prompt response.

An incorrect filing status can result in additional tax, penalties, and interest. For instance, if a married couple files as “Single” or “Head of Household” without meeting specific exceptions, they may have understated their tax liability. The IRS will recalculate the tax based on the correct status, which often results in a higher tax bill.

A married individual may be permitted to file as Head of Household, but the rules are strict. To qualify, the taxpayer must have lived apart from their spouse for the last six months of the year. They also must have paid more than half the cost of keeping up their home, and the home must have been the main home of a qualifying child.