It’s my annual “Taxes from A to Z” series! Next up:
After the death of a spouse, figuring out your taxes is probably the last thing on your mind. Uncle Sam gives you something of a tax break by allowing you to continue to file as married filing jointly in the year of death if you otherwise qualify to use that status.
But what about the year after? And the year after that? If you have dependent children, you may be able to file as qualifying widow(er) with dependent child for the two years following the year your spouse died. For example, if your spouse died in 2014, you would file as married filing jointly for 2014 but then, for 2015 and 2016, you can elect to file as qualifying widow(er) with dependent child.
To qualify, you must have been entitled to file as married filing jointly for the year in which your spouse died – even if you didn’t file with that status. You cannot remarry in any of the years you’re filing as a qualifying widow(er) with dependent child (if you remarry, file as married with your new spouse) and you must have a child for whom you can claim an exemption. For this purpose, your child or stepchild (but not a foster child) must have lived in your home all year (except for temporary absences) where you paid more than half the cost of keeping up a home. To figure the latter, you can use the worksheet found in IRS Pub 17.
What does filing as qualifying widow(er) with dependent child get you? It’s a sort of hybrid filing status which allows you to continue to use the joint tax tables and the equivalent standard deduction amount. It’s not the same as filing a joint return otherwise. However, the the ability to use those numbers (as opposed to single or Head of Household) will generally produce a more tax-favored result.