How the IRS Determines Your Marriage Status for Taxes

A taxpayer’s marital status is a factor in determining filing requirements, the standard deduction, and the total tax owed. The Internal Revenue Service (IRS) determines your status for the entire tax year based on whether you were married on a single date: December 31st. This classification influences which tax forms are necessary and what deductions and credits a taxpayer can claim. Correctly identifying your marital status according to federal tax law is an important part of tax preparation.

Determining Your Marital Status for Tax Purposes

The IRS applies the “last day of the year rule” to determine a taxpayer’s marital status. Your marital status on December 31st determines your status for the entire tax year. If you are legally married on the final day of the year, you are considered married for that entire year for tax purposes, even if the marriage occurred on December 31st. You cannot file using the “Single” status for the portion of the year before you were married.

The IRS recognizes all legally sanctioned marriages for federal tax purposes, including traditional, same-sex, and common-law marriages. For a common-law marriage to be recognized, it must be established in a state that permits it. If a couple establishes a common-law marriage in a state that permits it and then moves to a state that does not, the IRS will still consider them married.

A distinction exists between being separated and being legally divorced. Couples who are informally separated but do not have a final decree of divorce or separate maintenance by December 31 are still considered married by the IRS. To be considered unmarried for tax purposes, you must have a final court order by the last day of the year.

Filing Status Options for Married Taxpayers

Once considered married by the IRS, a couple has two filing status options: Married Filing Jointly (MFJ) or Married Filing Separately (MFS). Filing jointly usually results in a lower tax bill.

Choosing Married Filing Jointly means both spouses report their combined income, deductions, and credits on a single tax return. This status provides a higher standard deduction and access to a broader range of tax benefits, like education credits and the Earned Income Tax Credit. A legal consequence of filing a joint return is “joint and several liability,” which holds each spouse individually responsible for the entire tax liability, including interest and penalties.

Alternatively, married individuals can file as Married Filing Separately. With this status, each spouse files their own return, reporting only their own income, deductions, and credits. MFS comes with more restrictive rules; if one spouse itemizes deductions, the other cannot claim the standard deduction. The capital loss deduction is also limited to $1,500 per person, compared to the $3,000 limit for joint filers.

Special Circumstances Affecting Filing Status

Death of a Spouse

If a spouse passes away, the surviving spouse can file a joint return for that year if they haven’t remarried by December 31st. For the next two years, the survivor may file as a Qualifying Surviving Spouse. This requires having a dependent child, paying over half the home’s upkeep, and remaining unmarried.

Considered Unmarried for Head of Household Status

A married individual may be “considered unmarried” and file as Head of Household for a better tax rate and standard deduction than MFS. To qualify, the taxpayer’s spouse must not have lived in the home for the last six months of the year. The taxpayer must also pay more than half the home’s upkeep, and the home must be the main residence for a qualifying child for more than half the year.

Nonresident Alien Spouse

If one spouse is a nonresident alien, the couple must file separately. They can, however, elect to treat the nonresident spouse as a U.S. resident to file a joint return. This choice makes their combined worldwide income subject to U.S. income tax and applies to future years unless revoked.

Updating Your Withholding with Form W-4

A change in marital status requires you to review and update your tax withholding using Form W-4, Employee’s Withholding Certificate. Failing to adjust your withholding can lead to having too much or too little tax withheld, potentially resulting in a large tax bill or an underpayment penalty.

Before filling out a new Form W-4, you and your spouse must decide how to account for your combined income. If both spouses work, it is beneficial to use the IRS’s Tax Withholding Estimator tool. This online tool helps calculate the correct amount of withholding by accounting for both incomes simultaneously.

Once you determine the appropriate withholding, obtain a new Form W-4 from your employer or download it from IRS.gov. After completing and signing the form, submit it to your employer. Your employer will then use this updated form to adjust the federal income tax withheld from your future paychecks.