Your filing category is determined by marital status, household living arrangements and the people who are dependent on you for support.
Checking the right box at the top of the tax form is more than simply providing information to the IRS: It has a major impact on final tax liability. Your filing status determines which column you will use in the tax tables or which tax rate schedule to use. And if you itemize, the zero bracket amount you subtract from total deductions on Schedule A depends on your filing status, too.
Your marital status for tax purposes is determined by the circumstances on Dec. 31, 1985. That is, if you were married on that date, you are considered to have been married for the entire year, and may file a joint return.
Conversely, if you were unmarried on that date -- whether divorced, legally separated, widowed in a prior year or never married -- then you are considered to have been single for all of 1985. If You Were Married
You may elect to file separate returns (Category 3) even if you were married, but most couples will pay less total tax if they file a joint return. You must file a joint return (Category 2) to take advantage of the two-earner deduction on Schedule W or the tax credit for the elderly on Schedule R, unless you and your spouse lived apart for the entire year.
And there may be a major financial penalty if you are receiving Social Security benefits and choose to file separately. The income floor for determining the taxability of benefits is zero for a married person filing a separate return.
If you do file separate returns, you must both use the same method for computing the tax. That is, if one itemizes deductions, the other also must itemize and may not use the zero bracket amount.
If you and your spouse were living apart but were not legally separated, you may elect to file a joint return. This may result in a lower combined tax than filing separately; but each of you is then individually responsible for payment of the entire tax.
You may file as a single individual (Category 1) if you were married but lived apart from your husband or wife for at least the last six months of the year and paid more than half the cost of maintaining a home that was also the principal home of your dependent child during the year. Filing as single generally will result in a lower tax than using the married-filing-separately category.
(The rules have been changed for 1985. For prior years you had to have lived apart from your spouse for the entire year; and this year the child who lived in your home need not be your dependent if the exemption had been waived for or awarded to the non-custodial parent as a part of the divorce or separation agreement.) If You Were Recently Widowed
If your husband or wife died during 1985 and you had not remarried by Dec. 31, you may file a joint return and claim the exemption for your deceased spouse. Sign the return yourself, then write "surviving spouse" under your signature. Enter the date of your spouse's death in the name and address block at the top of the form.
If you were not the executor or administrator of the estate, the personal representative must sign the return also. If anyone other than the surviving spouse files for the deceased and claims a refund, Form 1310 -- which documents the right to the refund -- must accompany the return. Do not send a copy of the will or death certificate with the return.
If a personal representative has been appointed for the estate, he may have filed -- or may intend to file -- a separate "final return." And an estate tax return, if one is required, may have an impact on the income tax return. If the personal representative is not a professional, you may need help in this situation.
If your husband or wife died in 1983 or 1984 and you had not remarried by the end of 1985, you may be eligible to file as a qualifying widow(er) (Category 5) if you meet both of these tests:
You were eligible to file a joint return in the year of your spouse's death (whether or not you actually filed that way).
Your home was the principal residence during 1985 of a child whom you may claim as a dependent.
When you use the Category 5 filing status, you are not filing a joint return and you may not claim a personal exemption for your deceased spouse; you are only given the privilege of using the joint return tax rates. If You Were Single
If you were not married on Dec. 31, 1985, generally you must file as a single person. However, you may qualify for filing as head of a household (Category 4) and may enjoy the lower tax rates that go with that status if you meet any one of these tests:
*You paid more than half the expense of maintaining your home that was also the principal home for more than half the year of your unmarried child, stepchild, adopted child or grandchild, whether or not the child qualified as your dependent. (In 1984 and earlier years, the child had to live in your home for the entire year.)
*You paid more than half the cost of maintaining your home that was also the principal home for more than half the year of any other relative you claim as a dependent (but not a dependent under a multiple-support agreement).
*You paid more than half the cost of maintaining a home that was the principal home of your dependent mother or father, even if you didn't live there yourself. Maintenance of a parent in a rest home or home for the aged is accepted as equivalent to the maintenance of a household.
For the purpose of satisfying the six-month residence requirement, a person is considered to have lived in your home during temporary absences for vacation, school or hospitalization.