Do Homemakers Have to File Taxes? Navigating the Financial Rules for Stay-at-Home Spouses

Being a stay-at-home spouse comes with its own set of unique financial challenges and considerations While you may not be bringing in a paycheck, your contributions to the household are invaluable. However, when it comes to taxes, the rules can get a bit murky

Do homemakers have to file taxes? The answer, like most things in the tax world, is: it depends.

Factors that determine filing requirements for stay-at-home spouses:

• Income: If you earn any taxable income, regardless of the source, you’ll need to file a tax return. This includes income from freelance work, investments, or even selling items online.
• Joint Filing: If you’re married and filing jointly with your spouse, the income threshold for filing is higher than for single filers.
• Dependents: If you have dependents, you may be eligible to claim certain tax credits, which could affect your filing requirement.
• Tax Withholding: Even if you don’t earn income, you may still need to file a tax return if you had federal income tax withheld from your spouse’s paycheck.

Navigating the Financial Landscape as a Stay-at-Home Spouse:

• Get a Credit Card: The CARD Act of 2009 made it difficult for stay-at-home spouses to obtain credit cards in their own names. However, recent changes allow spouses to rely on their partner’s income to qualify for a card.
• Protect Your 401(k) Funds: If your spouse has a 401(k), federal law requires their signature if they want to name someone else as the beneficiary. This protects your retirement savings in case of unforeseen circumstances.
• Save for Retirement: Even without a paycheck, you can contribute to an IRA in your own name. This is crucial for building your own retirement nest egg and securing your financial future.
• Maximize Social Security: If you’re divorced after at least 10 years of marriage, you may be entitled to a portion of your ex-spouse’s Social Security benefits. This can significantly boost your retirement income.
• File Tax Returns: If you file jointly with your spouse, you may be eligible for “innocent spouse” relief if they cheat on their taxes. This can protect you from being held liable for any unpaid taxes.

Remember:

• Consult a tax professional for personalized advice on your specific situation.
• Stay informed about changes in tax laws and regulations.
• Take proactive steps to secure your financial future as a stay-at-home spouse.

Additional Resources:

• IRS Publication 501: Dependents, Standard Deduction, and Filing Information
• IRS Publication 929: Tax Rules for Children and Dependents (obsolete)
• National Women’s Law Center
• Women’s Institute for a Secure Retirement

By understanding the financial rules and taking proactive steps, stay-at-home spouses can navigate the tax landscape effectively and secure their financial future.