Are You Required to File an Income Tax Return?

We are in the middle of tax season, and while some have already taken care of it, some might still be wondering if they are required to file an income tax return. Now, we need to be aware of the consequences that might come if we fail to file our income tax return. Also, we must figure out whether we are required to do so or not, and what it depends on. This way, we can take advantage of the time we have left to submit such report and avoid any penalty.  

There are three main aspects that will determine whether we are required to file an income tax return or not. Such include our gross income and our filing status, as well as our age. Another reason why you would want to file your taxes is if you want to claim a tax refund. Remember to consult with a professional tax preparer to consult your particular situation.  

Gross Income and Filing Status 

One of the main aspects that determine if we are required to file an income tax return is your annual income and your filing status. There are different income thresholds we should go over, which vary per status. To begin with, if we are to file as a single person, our income threshold is $12,000. If we made less than that throughout the year, we are not required to file an income tax return. This is because, for the tax year 2018, the standard deduction for single tax payers is for that amount.  

The threshold for taxpayers who are married filing jointly is $24,000, and $5 for married taxpayers filing separately. If we are filing our taxes as a head of household, the threshold then goes down to $18,000. For those who decide to file their taxes as qualifying widow or widower with dependent child, the threshold goes up again to $24,000.  

Income of Taxpayers 65 or older 

Another aspect that will help us determine if we are required to file an income tax report is our age. If we turned 65 during 2018, our threshold will also change depending on our filing status. For example, single taxpayers 65 or older have an income threshold of $13,000. If we go for married filing jointly, we will qualify for one of two different thresholds. If only one spouse is 65 or older, the threshold is $25,300, but if both are 65 or older, it goes to $26,000. 

The head of household status also depends on age, allowing for a threshold of $19,600 if we’re 65 or older. Besides, a threshold of $25,300 applies for those who file as qualifying widow or widower with dependent child.  

Claim a Tax Refund 

There are some taxpayers who may not be required to file an income tax return but might want to. If your employer withheld federal taxes for your paycheck, you might qualify for a refund. For example, if your annual income was less than the $12,000 standard deduction, you are eligible for a tax refund. This means that, if your employer withheld $500 of federal taxes, you are entitled to receive that money back. In order to be able to receive such a refund, you are required to file an income tax return, regardless of your income. This is because the IRS won’t automatically issue any refunds, and needs to receive the corresponding tax report.  

If you worked as a freelancer or self-employed during 2018, you might want to read this article instead.