Most people assume that every individual who has income has to file a federal income tax return. In reality, If your income for the full calendar year falls below thresholds specified by the Internal Revenue Service, such filing is not mandatory. However, it may be to your advantage to file a tax return, even if the law does not mandate it.
If you have no taxable income, you owe no taxes to the government and do not need to file an income tax return. Your tax liability is based on your taxable income, which equals your gross income minus all applicable deductions. If your gross income is less than the standard deductions applicable to you, it is OK not to file an income tax return. The IRS knows that your taxable income, and therefore your tax liability, will be zero and has no interest in wasting your time with unnecessary paperwork.
If you are single, below the age of 65 and no taxpayer has claimed you as a dependent on a tax return, you can claim a standard deduction plus an exemption. These add up to $9,500 as of the time of publication. If your gross income is below $9,500, you do not need to file an income tax return. If you are over 65, the sum of your standard deduction and exemptions increases to $11,200. If you have made less money than that, you do not need to file a return. When determining your gross income for the year, do not include your Social Security checks, which are tax-exempt payments.
If someone has claimed you as a dependent, you must file a return if your gross income exceeds $5,950 and you are younger than 65. For taxpayers who are older than 65 and have been claimed as a dependent, the limit rises to $7,400.
When filing as the head of household, you must file an income tax return for income exceeding $12,500 if you are under 65 and $13,650 if you are older than 65. For married couples filing jointly, these figures increase to $19,500 and $21,800, respectively. If you are married and filing separately, you must file a return if your income is over $3,800, regardless of your age. Widows or widowers under 65 with a qualifying dependent need not file taxes if they earn less than $15,700 a year. Such people over 65 can earn up to $16,850 before they must file a return.
File Voluntarily If
If a payer or employer has withheld taxes from your income, you should file a return even if your income is below the thresholds. In this case, you will likely receive a refund from the IRS, which you cannot claim without filing a return. You may also receive money if you qualify for a refundable credit. Various such credits exist in the tax code, and common examples include the Earned Income Credit, the Additional Child Tax Credit and the American Opportunity college credit.
- Comstock/Comstock/Getty Images