Tax Filing Status When a Spouse Dies

When a spouse passes away, the surviving individual faces numerous adjustments, including changes to their tax filing status. Tax filing status is a fundamental component of federal income tax calculations, influencing tax rates, standard deduction amounts, and eligibility for various credits and deductions. The Internal Revenue Service (IRS) provides specific guidelines for surviving spouses, recognizing the significant impact of such a life event on financial circumstances. Choosing the correct filing status can lead to a more favorable tax outcome.

Filing Status for the Year of Death

For the tax year in which a spouse dies, the surviving spouse is considered married for the entire year for tax purposes. This allows the surviving spouse to file a joint return, “Married Filing Jointly,” with the deceased spouse for that tax year. This option is available unless the surviving spouse remarries before the end of the tax year. If remarriage occurs, the surviving spouse cannot file a joint return with the deceased spouse but can file jointly with the new spouse.

When filing a joint return for the year of death, the return should include all income earned by both the deceased spouse up to the date of death and the surviving spouse for the entire year. To notify the IRS of the death, write “Deceased,” the deceased spouse’s name, and the date of death across the top of the tax return. If filing a paper return, the surviving spouse should sign the return and write “Filing as Surviving Spouse” in the deceased spouse’s signature area.

“Married Filing Jointly” is often the most advantageous choice due to its lower tax rates and higher standard deduction. “Married Filing Separately” remains an alternative, but typically results in a higher tax liability. If a final Form 1040 return is required for the deceased spouse and no joint return is filed, the “Married Filing Separately” status would be used for the deceased’s return.

Qualifying Widow(er) Status with Dependent Child

Following the year of a spouse’s death, a surviving spouse may be eligible to use the “Qualifying Widow(er)” filing status, officially termed “Qualifying Surviving Spouse” by the IRS. This status is specifically designed to provide a tax advantage similar to that of married couples filing jointly for a limited period. It allows the surviving spouse to benefit from the same tax rates and the highest standard deduction amount as if they were still filing jointly.

To qualify, the deceased spouse must have died within the two tax years immediately preceding the current tax year, and the surviving spouse must not have remarried before the end of the current tax year. For example, if a spouse died in 2023, the surviving spouse could use this status for the 2024 and 2025 tax years. Additionally, the surviving spouse must have a child or stepchild (not a foster child) who qualifies as their dependent and who lived in the home for the entire year.

The requirement that the child lived in the home for the entire year includes exceptions for temporary absences, such as for school, vacation, medical treatment, or military service, provided it is reasonable to expect the person to return. The surviving spouse must also have paid more than half the cost of keeping up the home, which includes expenses like rent or mortgage payments, property taxes, utilities, and groceries. Internal Revenue Code Section 2 outlines these conditions.

Head of Household Status

When a surviving spouse no longer qualifies for “Qualifying Widow(er)” status, or if they never met its criteria, “Head of Household” (HOH) status may be an option. This filing status, defined under Internal Revenue Code Section 2, offers more favorable tax rates and a higher standard deduction compared to filing as “Single.” To be eligible, the taxpayer must be unmarried or considered unmarried on the last day of the tax year.

A taxpayer is considered unmarried if they are legally separated, divorced, or if their spouse did not live in their home for the last six months of the tax year, and they file a separate return. A primary requirement for HOH status is paying more than half the cost of keeping up a home for the tax year, including expenses such as rent, mortgage interest, property taxes, utilities, and home repairs.

A qualifying person must have lived with the taxpayer in that home for more than half the year, with exceptions for temporary absences. A qualifying person is typically a dependent child, stepchild, or adopted child, but can also include other relatives if specific dependency tests are met. If the qualifying person is a dependent parent, they do not necessarily have to live with the taxpayer, provided the taxpayer pays more than half the cost of keeping up the parent’s home.

Single Filing Status

Ultimately, if a surviving spouse does not meet the requirements for “Qualifying Widow(er)” or “Head of Household” status, they will file as “Single.” This status, outlined in Internal Revenue Code Section 2, applies to individuals who are unmarried, divorced, or legally separated on the last day of the tax year. It is considered the default status for those who are not married and do not have qualifying dependents.

The “Single” filing status generally comes with the highest tax rates and the lowest standard deduction compared to the other statuses discussed, often resulting in a higher tax liability. Electing this status means the taxpayer will use the tax brackets and standard deduction amounts designated for individuals without dependents or special marital circumstances. Once the two-year period for Qualifying Widow(er) status expires, and if no Head of Household criteria are met, the surviving spouse transitions to filing as Single.