# Presentation: 369697

## Lesson 2

**Filing Status and Filing Requirements**

**Notes:**
This lesson contains information for all course and has been updated for Tax Year 2007. 

  References:
Form 1040
Form 1040A
Publication 501, Exemptions, Dependents And Filing Status
Publication 4012, Volunteer Resource Guide

  Additional Reference:
None

Progress to the next slide.

## Objectives

- Apply the requirements for each of the five filing statuses
- Determine who must file
- Determine who should file
- Select the appropriate tax form to use

**Notes:**
 Review the objectives with the class.
 Show the students where to find this information in the Publication 4012.

Progress to the next slide.

## Intake/Interview Process

- Form 13614 – Intake and Interview Sheet – Taxpayer Information Section

**Notes:**
Use the Form 13614 Intake/Interview Sheet to engage your taxpayer in preparing an accurate return. 
Use the Intake/Interview Sheet as a starting point for a comprehensive interaction with the taxpayer in combination with all the source documents provided by the taxpayer to assure quality and accuracy on each return.  
Confirm each item on the Form 13614 (or similar approved tool used at your site) to make sure you and your customer have considered all the necessary information to assure all questions and issues have been addressed.   If items are incorrect or incomplete, revisit the issue and make corrections to the return, as needed. 
Filing Status and Filing Requirements are covered in this lesson. To determine accurate determination of filing status, ask the taxpayer their marital status on December 31, 2006. You will also need to know if they pay more than half the cost of keeping up the home; and if they were married, were they living apart form their spouse during the last 6 months of the year, etc..
You will learn more about the requirements in determining filing status and filing requirements later on in this lesson.
Filing requirements are also covered in this lesson. Many of the facts that you obtain from the use of Form 13614 will guide you in your determination of the filing requirement of the taxpayer, i.e. filing status, age, gross income, if claimed as a dependent on another tax return, etc. Ensure that all questions on Form 13614 are asked.

Progress to the next slide.

## Filing Status	

- Single
- Married Filing Jointly
- Married Filing Separately

**Notes:**
Have the students read the text for the Single, Married Filing Jointly and Married Filing Separately filing statuses.
Inform the students that the married filing separately status may result in lower tax if one spouse has high medical or miscellaneous expenses.
Ask Guided Questions:
Is married filing jointly the only status available to spouses? (No; they can file married filing separately.)
If a married couple files separately, and one spouse itemizes deductions, is the other spouse required to itemize deductions? (Yes)

Progress to the next slide.

## Filing Status

- Head of Household
- Qualifying Widow(er)

**Notes:**
Have the students read the text for the Head of Household and Qualifying Widow filing statuses.
Review the qualifications for Head of Household with the class; emphasize that the taxpayer must have a qualifying child or qualifying relative.  Review the example 1 (Darlisa) page 2-5 with the class.
Ask Guided Questions:
For a relative to qualify a taxpayer for the head of household filing status, how long must the taxpayer’s home be the main home of the relative? (More than half of the year.)
What information must you know to determine if a widow or widower can use the Qualifying Widow (er) filing status? (The year the spouse died, does the taxpayer have a qualifying child.) 

Progress to the next slide.

## Tools For Determining Filing Status

-  ** **Interview Tips
-   Decision Tree

**Notes:**
Inform students that Publication 4012, Volunteer Resource Guide contains the Filing Status Interview Tips chart.  Have them locate the chart in the Publication 4012 and/or text.
Ask Guided Question: 
Why is it important to select the correct filing status? (Because the filing status determines which column of the tax chart is used to calculate the taxpayer’s tax.)
Review the TaxWise Hints on page 2-10.
Have the students work the exercises on pages 2-12.  The answers are on page 2-13.
Review the answers to the exercises and ask if there are any questions.

Progress to the next slide.

## Who Must/Should File?	

- Charts are provided to help you determine who must file
- Taxpayers who fall below the filing requirements should file:
- to claim a refund of withheld taxes
- to claim an Earned Income Credit
- to claim the Additional Child Tax Credit
- To claim a credit for federal telephone excise tax paid

**Notes:**
Have the students read the Who Must File/Who Should File section of this lesson.
Review the “Who Must File” charts with the class.  Stress that caution should be used in determining which chart applies.
Have students work the exercises 12 and 13.
Review the answers to the exercises.
Ask Guided Question: 
What information must a volunteer have to determine if an individual must file a return? (The filing status, age, gross income, and type of income.)
Ask if there are any questions.

Progress to the next slide.

## Which Form Should You Use?

- Simplest form that will accommodate the taxpayer’s income and expenses:
- 1040EZ
- 1040A
- 1040

**Notes:**
Have students read this section of the lesson.
Tell the students that using the simplest form that will accommodate the taxpayer’s income and expenses will help reduce errors on returns and allow faster processing of the return.
Ask if there are any questions.

Progress to the next slide.

## Quality Review (QR)

- Form 8158 – Quality Review Checklist
- Filing Status

**Notes:**
Use the Form 8158, Quality Review Checklist or approved alternative form to review all returns prepared.  
Apply the QR tools in combination with the Intake/Interview Sheet and all the source documents to the returns you prepare to assure quality and accuracy for every taxpayer.  
Consider each box on the QR checklist which applies to your taxpayer’s situation to confirm that all the necessary questions and issues have been addressed.   If items are incorrect or incomplete, revisit the issue and make corrections to the return, as needed.
To ensure accurate reporting of filing status, verify the information on the Intake/Interview Sheet and on the taxpayer’s supporting documents is included on the return.
Confirm that all questions on filing status have been discussed with the taxpayer and shown on the return if applicable.

Progress to the next lesson.

## Lesson Summary

- Choose the correct Filing Status
- Determine the appropriate tax form to use

**Notes:**
Review each of the five filing statuses.
Key points:
Consider each of the applicable filing statuses and choose the one that will result in the lowest tax.
Head of Household requirements changed beginning in tax year 2005 due to the “Uniform Definition of a Child. 
Review the “Determination of Filing Status chart , Publication 4012, Tab B, Filing Status
Always use the tax form that will accommodate the taxpayer’s income and expenses.  Summarize using the charts in Publication 4012, Tabs A and B

If covering the Military/International courses, progress to the next slide.  All others, progress to Lesson 3.

## Military Objectives

- Determine the correct filing status for resident aliens.
- Explain how to treat a nonresident alien’s spouse as a resident.

**Notes:**
Additional resources
Publication 3, Armed Forces Tax Guide

Progress to the next slide.

## Military Filing Status Issues

- Married nonresidents filing jointly
- Treating nonresident spouse as a U.S. resident
- Making the choice

**Notes:**
Have students read M-2-1 through M-2-4
Review examples 1, 2 and 3
Discuss special rule for head of household filing status

## Summing Up This Military Segment

- The taxpayer may be considered unmarried for the Head of Household filing status, if the spouse was a nonresident alien at any time during the year and the taxpayer does not choose to treat the spouse as a resident alien.

**Notes:**
Progress to the next lesson.