Not everyone is required to file taxes, but most Americans are and likely will file taxes.
Of the 176.2 million individuals and married couples who could file a tax return in 2020, about 144.5 million of them filed a tax return, according to nonpartisan Washington think tank Tax Policy Center. Whether you need to file your taxes depends mostly on your income, filing status, and age. In special situations, you may have to file a tax return regardless of your income, though. For example, if you have net earnings of at least $400 from self-employment, you’re required to file taxes.
Having said that, even if you’re not required to file a tax return, you may want to file to claim tax credits and overpayments that could result in money being returned to you.
This may sound confusing, but we’ll explain it all here so you can stay within the law or even reap some benefits for putting in a little unrequired work.
Who is legally required to file a tax return?
To determine if you’re one of the millions who have to file a return, start with your gross income, which is total income before taxes and adjustments, age and filing status. Filing status is if you’re single or married filing jointly or separately, head of household, or a widow(er).
Depending on your age and filing status, the IRS has minimum income thresholds that determine whether you must file a tax return. Here are the breakdowns:
Single filing status:
- $12,950 if under age 65
- $14,700 if age 65 or older
Married filing jointly:
- $25,900 if both spouses under age 65
- $27,300 if one spouse under age 65 and one age 65 or older
- $28,700 if both spouses age 65 or older
Married filing separately:
Head of household:
- $19,400 if under age 65
- $21,150 if age 65 or older
Qualifying widow(er) with dependent child:
- $25,900 if under age 65
- $27,300 if age 65 or older
People with “special situations” may have to file a tax return, regardless of income. Some of these situations include:
1. You owe any special taxes, such as:
- Alternative minimum tax, which is generally for very high income taxpayers.
- Additional tax on a qualified plan, including an individual retirement arrangement (IRA), or another tax-favored account.
- Social Security or Medicare tax on tips you didn’t report to your employer or on wages you received from an employer who didn’t withhold these taxes.
- Uncollected Social Security, Medicare, or railroad retirement tax on tips you reported to your employer or on group-term life insurance and additional taxes on health savings accounts.
- Household employment taxes.
- Recapture taxes, which is paying back the federal government for benefits of using tax-exempt mortgage bonds were used for financing.
2. You (or your spouse, if filing jointly) bought health insurance from a state or federal marketplace or received health savings account distributions.
3. You had net earnings from self-employment of at least $400.
4. You had wages of $108.28 or more from a church or qualified church-controlled organization that’s exempt from employer Social Security and Medicare taxes.
Note: if you can be claimed as a dependent on someone else’s tax return, your tax filing requirements are different.
If you’re still stumped, take the IRS’ interactive tool to help you determine if you need to file a tax return.
Should I file a tax return even if I’m not required to?
If you think you can get money back, yes. Consider filing if any of the following apply:
- You had income tax withheld from your paycheck. You can get a refund of that amount.
- You overpaid. For example, if you made estimated tax payments or had any of your overpayment for last year applied to this year’s estimated tax, you might be due money back.
- Earned income tax credit (EITC). You may qualify for this refundable credit, meaning even if you do not owe taxes, you can still get a refund. Depending on your income and the number of children you have, lower-income workers may be eligible for an EITC of $510 to $6,318, but you don’t need to have children to be eligible for EITC.
- Additional child tax credit. If you qualify, you can receive up to $1,500 of the $2,000 Child Tax Credit per child as a refund.
- American opportunity credit. If you qualify for this tax credit to help pay for post-high school education expenses, you can get a maximum annual credit of $2,500 per eligible student and 40% or $1,000 could be refunded if you owe no tax.
- Premium tax credit. If you qualify, you can get a refund on this credit that helps eligible individuals and families cover the premiums for their health insurance purchased through the Health Insurance Marketplace.
Even without a refund due, the IRS recommends you file a tax return if you received a 1099-B, which has information about securities or property involved in a transaction handled by a broker, to avoid getting a notice from the IRS.
Medora Lee is a money, markets and personal finance reporter at USA TODAY. You can reach her at email@example.com and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
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