Unmarried Couple

[Christian]

An unmarried couple who reside in the same home now have two children. They would like to each claim one of their children and file as HOH. Since they both will be reporting the same physical address on their returns I am none to anxious to file their returns this way. I feel sure many of you are running into this issue and would appreciate what solution you came up with.

[Lynn EA USTCP in Louisiana]

One is HOH and the other is single. 

 

[BrewOne]

If they went that route, they should expect to have to prove in court that they operated as two separate families, occupying separate sections of the house (separate kitchens?) which is not plausible if they are a couple.  I believe the same tax credits are available for S w/ dependent as HoH, the main difference is a larger standard deduction and an expanded 10% tax bracket--hardly worth a court fight.

[schirallicpa]

I had done a couple of years of tax returns a few years ago that the woman used the physical address and the man used his mothers address.  When I realized that they were living together I fired them.  Also remember EIC rules if applicable.  I am an advocate of every taxpayer filing individually and get rid of all the credits.  Just tax me for my income.  Done. 

[Lion EA]

If you're old enough to remember the old TV show "Kate & Allie" about two single women with their own kids sharing a house, that could've been two households. maybe. I was taught at Block, if they share the master bedroom, it's ONE household. Do what Lynn said.

[Lee B]

I can envision a situation with 2 unmarried adults living together each with their own child sharing the rent and utilities 50/50

while each one pays for their own food, clothing,etc would be able to both file HOH.

[schirallicpa]

New line on the client questionnaire:  Have you shared a bedroom for greater than 6 months?

[Medlin Software, Dennis]

See if both are using the same banking info (assuming direct deposit of refund). If they pay retainer by check, are both names on the check? There may be some non invasive ways to make your determination. Sans some sort of divorce or separation papers, it is likely best to start with "prove you are not one household".

[Lion EA]

If the kids are biological children of both parents as a couple, I'd be suspicious that it's one household. But I think we've all seen a bit of everything.

I have two cousins who inherited a house from their grandmother and live there happily ever after. No kids, so don't have to deal with HOH, thank goodness. Split everything 50/50 for decades. Even when they were still working, and the one with higher income would've benefited from a larger percentage of the deductions. They wanted everything 50/50, each year. One always drove them to work and to everyplace for years until her eyesight failed, loving to have a truck and a fast car and a reliable commuter car and a spare car; now the other does all the driving, I think only an SUV. Still vehicle ownership and car tax remain 50/50. The split of deductions no longer matters on their nearly identical retirement incomes and with the higher standard deduction.

I've had divorcing clients/divorced clients who couldn't afford a separate house/apartment close enough to kids/schools, jobs, etc., so one moved into the guest room or the finished basement or the mother-in-laws' quarters or the guest house or otherwise divided up the physical house. Separate households. Didn't Fergie and her Prince live together to continue to co-parent for years?

We see it all in our biz. But we are required to ask more questions if we're not comfortable that what we're hearing is the full, complete story. Don't let your clients tell you how to file their taxes. It's our job to tell our clients their options or option.

[GLGACCT]

See attached link below the requirement is more than one-half of the cost of maintaining the household

https://www.irs.gov/faqs/filing-requirements-status-dependents/filing-status

Second FAQ:

Question:

If the parents of a year-old child never married but live together with the child for the tax year, and both contribute to the cost of maintaining the household for the child and themselves, may they both file as head of household?

Answer:

No, only one parent may claim the child as a qualifying child to file as head of household.

To file as head of household you must furnish over one-half of the cost of maintaining the household for you and a qualifying person. Therefore, only one of the parents will have contributed more than one-half of the cost of maintaining the household and be eligible to file as head of household.

If a child is a qualifying child of both parents, there is a tiebreaker rule to determine which parent may claim the child. See Publication 501, Dependents, Standard Deduction and Filing Information for more information.