North Carolina Filing Status
The filing status claimed on the federal return must also be claimed on the North Carolina income tax return. Generally, if the taxpayer has not filed a federal income tax return, the taxpayer must claim the filing status to which the taxpayer is entitled under the Internal Revenue Code. However, for a married couple filing a joint federal income tax return, if either the taxpayer or the taxpayer’s spouse is a nonresident and has no North Carolina taxable income for the taxable year, the filing status married filing separately may be claimed on the North Carolina income tax return. Importantly, once a joint return is filed, separate returns may not be filed for that year after the due date of the return.
Be sure to check the appropriate filing status on your North Carolina return.
Legal Separation and Filing Status
Under Section 2(b)(2) of the Code, an individual who is legally separated from his/her spouse under a decree of divorce or of separate maintenance shall not be considered as married. North Carolina law, G.S. § 52-10.1, authorizes a married couple to enter into a legal separation agreement. Although an agreement pursuant to G.S. § 52-10.1 is a legal contract without being sanctioned by a court, it does not constitute a legal separation under a decree of divorce or of separate maintenance within the meaning of the Internal Revenue Code. Therefore, a separation agreement must be sanctioned by a court in the form of a decree or judgment for parties to be considered unmarried for purposes of section 2(b) of the Code.
Importantly, section 2(c) of the Code and G.S. § 105-153.3(7) also incorporate section 7703 of the Code. Section 7703 of the Code expands the eligibly for head of household status to certain married individuals living apart (including those without a decree of divorce or separate maintenance). To the extent an individual meets the requirements of section 7703 of the Code and so qualifies for head of household filing status for federal purposes, the individual will also qualify for the head of household filing status for North Carolina purposes.
You may obtain additional information by calling toll-free at 1-877-252-3052 or visiting a service center.