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Do I Have to File a Tax Return This Year?
Posted By timparker On 03/05/2012 @ 2:00 pm In Taxes | 1 Comment
Everybody has to file a tax return, right? That isn’t necessarily true, according to the IRS but before you decide that you are one of the lucky individuals who don’t have to file, be sure that you’re right because not filing a return can lead to stiff penalties for those who don’t file but should have.
The IRS doesn’t require anybody to file a tax return that is under a certain income level. Smartmoney  has a table that lays out the income thresholds. If you’re single and under 65, you could have made as much as $9,500 in 2011 without having to file a return. If you’re married and both of you are under 65, your limit was $19,000. Different rules may apply to you if you’re claimed as a dependent.
Even if you fall under the maximum income, you may still want to file a tax return. In other cases, you may be required to file. Do any of these situations apply to you?
If you had federal taxes withheld from your paychecks but didn’t make enough to owe taxes, those withholdings may be returned to you if you file a return. Of course each person has a different tax situation but many people who earned less than minimum income don’t know that they’re entitled to a refund in many cases. Usually, the easy to complete 1040EZ form is all that is required.
If you made a withdrawal from your IRA and owe the 10% penalty, you’re required to file a return. Other special taxes could include the alternative minimum tax or federal employment taxes for household employees. Although not a complete list of special taxes, most people under the income threshold won’t fall in to this category but it’s important to make sure.
Just because you worked at a church doesn’t meant that you’re required to file a return. If you worked at a church that was exempt from social security or Medicare taxes, you have to file if you made more than $108.28. This also includes any organization that was controlled by a church of this type.
If you’re self employed, you fall under different requirements. If you made over $400.00 as a self employed individual, you are required to file a tax return. Did you sell a home? The IRS requires that you file a tax return if you sold your home regardless of your level of income.
If you earn tips as part of your income, you have to file a tax return if you owe medicare or social security taxes on tips that weren’t reported to your employer. Any income you receive from tips becomes part of your yearly income and has to be reported to IRS either by you or your employer. There may be other situations that apply to you. For a larger list, click here .
In most cases, if you fall under the income threshold set by the IRS, you won’t have to file a return but if you’re owed a refund or you fall in to one of the situations laid out above, a return may be required. When in doubt, ask for help. Not filing could trigger interest and penalties in later years.
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