Ladies, this one small tax break we get will probably be gone next year, and our tax bills will go up.
But this year, every eligible single mom should claim Head of Household status, and keep her income tax bill as low as possible.
Using this filing status can save you hundreds, maybe even thousands, of dollars on your income taxes.
For one thing, the standard deduction using HoH status is $9,300. If you file as single instead, it’s only $6,300. With HoH, you automatically pay taxes on $3,000 less … and that’s just the start.
On top of that savings, HoH filers have bigger tax brackets (tax categories based on earnings). For example, if you’re an HoH filer, you’d pay 10% tax on the first $13,250 you earn. But if you file as single instead, that low 10% rate is only good on the first $9,275 of earnings.
Here’s what that looks like in terms of your money:
- An HoH filer with $13,000 of taxable income would pay $1,300 in taxes.
- A person filing as single with the exact same income would pay $1,486.25.
- Filing as HoH would save you almost $200.
And when you’re a single mom, every dollar counts, so use HoH status if you can.
Here’s how you qualify:
You’re not married as of December 31, 2016
You paid more than half of the cost to support your household
You support a qualifying child
Those are the basics. Here are some more details…
If you’re technically married on December 31, you may still be able to claim HoH. First rule: to use HoH, you can’t file a joint tax return with your soon-to-be ex. Also, you have to have been living apart from your ex since at least June 2016, and you have to have primary physical custody of the kids.
What counts toward household support? Most of the things you’d expect, like rent or mortgage, utilities, homeowner’s insurance, property taxes, home repairs, and groceries.
A qualifying child includes more than just your natural and adopted kids under age 19 (or under 24 if they’re full-time students). This category can also include:
- foster children
- siblings and half- or step-siblings
- nieces and nephews
As long as they lived with you for more than half the year and you can claim them as dependents on your tax return, they count.
If you’re not sure you qualify to use the HoH status, please ask!