If you are like most people, you are looking for any way you can to save money on your taxes each year. If you are single and have children that you are caring for a majority of the time, then you could be missing out on tax savings. If you aren’t filing for head of household, you might be able to. Mark Dicus & Company is here to talk about what it means to file head of household (HOH) status.
How is Head of Household Defined?
When you are a single person that has dependents that you are caring for, it is important that you know what your options are for filing your taxes. HOH is a filing status that is available for people that are unmarried but still provide the primary support for dependents. This can help to lower tax rates and increase standard deductions for these people. It can result in much lower tax bills. To qualify for HOH, you have to meet these criteria:
– You must be unmarried or considered unmarried by the last day of the tax year.
– You have to be financially responsible for more than half of the cost of maintaining your household or the entire year.
– You need to have a qualifying child or dependent living with you for more than half the tax year.
Benefits of Filing as HOH
Some may be wondering what the benefits of filing taxes as the HOH are. Changing your filing status to HOH can help lower your tax rate much more than filing single or married but single. The goal is to lower your taxable income. When you qualify for a higher standard deduction, this is the result. Another thing that can end up being incredibly beneficial is qualifying for the earned income tax credit. You may be eligible for this credit and more.
Claiming HOH With Joint Custody of a Child
If you have joint custody of your child, you may or may not be eligible to file HOH. The biggest thing that you need to remember is that you have to have custody of your child for more than half the time. You must be the parent that is providing the child with primary support.
Tips for Filing HOH
For any parent that is hoping to file HOH, it is vital that you are keeping detailed records of all the financial support that you are providing for the child as well as the child’s living arrangements. It is also important to understand what a “qualifying child” looks like as far as tax purposes go.
Bookkeepers, Accountants & More in Summerlin, North LV, Henderson, Lone Mountain Village & Greater Las Vegas, Nevada
If you are confused about what filing status would be best for you, you can turn to Mark Dicus & Company to help you sort it all out. We will help you determine whether or not filing HOH is the right choice for you. Call us today!