Amended Tax Return???

So apparently my parent has been filing taxes under head of household (because my step-parent doesnt work or file taxes due to disability). Anyway i was selected for verification by the FA office because apparently if your parents are married no one should file as HoH (unless there are some special circumstances but i checked and they dont apply to my situation).

The problem is that my parent has been filing this way for several years (like 6ish??), and im worried that if I do the whole amended tax thing this will mean my parent will be charged penalties by the IRS. I also am worried about my aid not being processed in time. How long does it take to file an amended tax return and have everything processed? I just feel really worried and I dont know what to do.

It is not your decision but theirs. However, if they don’t file correctly you may be denied financial aid.

But why not do an amended 2015 return, married filing jointly, and see what happens. If it does show that taxes, interest and penalties are due, they can decide if they’d rather pay them or forfeit financial aid.

I don’t think you have a choice…if you want financial aid.

Tax filing status MUST align with the marital status of the family.

If not…parents will need to amend.

Even if only one parent has income, and is considering themselves the “head of household”, they cannot use that federal filing status if they are married and living together.

They should file married filing jointly.

Did they do their own taxes?

They should talk to a tax preparer and see if they can amend all 6 years. As married filing jointly the standard deduction should be more than the one for HOH ($12,700 versus $9,350), so I would think their tax liablity would go down, and they might qualify for other tax credits filing MFJ.

If the amended returns result in a tax refund, I think they can only get that for the previous 3 years.

Your parents must file correctly for 2015 if they want you to get aid. That means they must amend their return(s). We have no way of knowing if there will be issues that stem from that, but we can tell you that you won’t get aid if there is no amendment made. Your parents will need to determine how to proceed, knowing this fact.