Because you are married, you cannot be treated as single. You can file a joint return, or you can opt to file as “married filing separately.” However, if spouses live apart and meet certain tests, one may qualify to file as head of household instead of married filing separately. To do this, you must have a qualifying person live with you (or a dependent parent even if not living with you); a spouse is not a qualifying person.
The difference between face value of a bond and lower market price, attributable to rising interest rates. On a sale, gain on the bond is generally taxed as ordinary income to the extent of the discount.