Head of household filing status

Rusty Shackelford

Fly on the Wall
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Helped brother with his simple W2 only taxes...only issue is he was married for 11/12ths of year and had witholdings done as such....IRS say he is single based on martial status on 12/31 unless he meets the 3 criteria for filing head of household. He met all three criteria. IRS sent letter stating they changed his status to single and he owes taxes because the dependent was already claimed by someone else (ex wife).

Any thoughts or suggestions?
Yes, but it was my understanding that the head of household status was basically to negate the negative impact of the divorce in the year it took place. The dependent lived in his home for 11 of the 12 months. Entirely shady system that had him paying taxes as married for 11 months then consider him single because he was unmarried for 1. It ain't the end of the world, but he now owes an additional $3000 and will likely face underpayment penalties for not having enough with held once the rules changed in the bottom of the 9th inning.
These issues aren't something that I have ever had to deal with. I found this which indicates that the issues with head of household and claiming kids can be complicated:

only one tax return can claim the kids.....prior to the divorce both parents were providing support....at divorce the divorce papers normally clarify which parent/s gets to claim that support in any forthcomming tax fileings.......when i got divorced many years ago i was wise enough to write the paperwork to where each of us were able to claim one kid in perpetuity (even though i was the custodial parent) that was over 35yrs ago so things might have changed
I always thought if a parent was providing more than 50% of support to a non-custodial child then that parent should and can claim that child as a dependent. However, if the mother has custody of the child then it is hard for the non-custodial to meet the 50% threshold. That is providing that child support payments were set outrageously high.

However, filing status is determined as of 12/31.

You brother would be wise to get some professional on this year's taxes. So unless the divorce decree stipulated who can claim the children it will go to the custodial parent. In that case for a divorce in December, the non-custodial parent loses all tax dependents for the entire year. To my knowledge this is not prorated but a CPA should be of assistance in getting through this mess.

Good luck to you brother.
Yep due today.

He is likely going to just pay up...the problem is not so much the dependent status as is was the fact his w-4 was set at married rate for 11/12ths of the year, but the last day of the year is the only thing that counts.....his withholdings were based on a SD of $25,900 not $12,500. You would think the IRS would realize this is highly messed up.
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