Who Needs to File a Tax Return?
If your income is above a threshold based on your filing status, age and income, you are required to file a federal income tax return. Those thresholds vary quite a bit due to the different factors, so here’s a handy table to help you pinpoint the numbers that apply to you:
|Filing Status||Age at End of 2020||File if Gross Income is at Least|
|65 or older||$14,050|
|Married filing jointly||under 65 (both spouses)||$24,800|
|65 or older (one spouse)||$26,100|
|65 or older (both spouses)||$27,400|
|Married filing separately||any age||$5|
|Head of household||under 65||$18,650|
|65 or older||$20,300|
|Qualifying widow(er)||under 65||$24,800|
|65 or older||$26,100|
Do I need to file even if I’m not required to by filing status, age, and income level?
In some cases, yes—you will still need to ﬁle a tax return if any of the following apply:
- You owe any taxes, such as alternative minimum tax, taxes on a retirement plan distribution, household employment taxes, and Social Security and Medicare taxes that were not withheld from income.
- You received a distribution from a health savings account, Archer MSA, or Medicare Advantage MSA.
- You had at least $400 in self-employment income.
- You earned $108.28 or more from a church or qualified church-controlled organization that is exempt from employer Social Security and Medicare taxes.
- You received an advance payment of the Premium Tax Credit for health insurance bought from a health insurance marketplace. You should receive Form 1095-A with the amount of the advance payments.
- Advance payments of the health coverage tax credit were made for you, your spouse or a dependent. You should receive Form 1099-H with the amount of the advance payments. Note: For tax year 2020, any excess amount of advance premium tax credit payments received doesn’t have to be repaid, according to the American Rescue Plan (ARPA).
- You were required to file Form 965 for a triggering event or Form 965-A for an elected installment payment.
Should I file a tax return even if I’m not technically required to?
There are some cases where it’s advisable to file a tax return anyway, even if you could legally decline.
First, if you had federal income tax withheld from your pay, or if you made estimated tax payments, you should file in order to get any surplus withholding refunded back to you.
Second, there are a few tax credits that can give you a refund even if you didn’t make enough income to file. These are called “refundable” credits. Nonrefundable credits can only apply against taxes you owe.
- Earned Income Tax Credit – You could qualify for the EIC if you worked but didn’t earn a lot of money. Your credit amount will depend on income level, filing status and how many dependents you claim.
- Additional Child Tax Credit – This credit could be available if you have at least one qualifying child and you didn’t receive the full amount from the Child Tax Credit.
- American Opportunity Credit – The maximum credit for this education credit per student is $2,500 for the first four years of postsecondary education. Up to $1,000 of the credit can be refundable.
With these credits, you have to file in order to receive the benefit.
Are my Social Security benefits taxable?
That depends on your other income and benefits for the tax year, since Social Security benefits include monthly retirement, survivor and disability benefits. They don’t include any supplemental security income (SSI) payments, which are not taxable.
As a very general rule of thumb, if your only income is from Social Security benefits, they won’t be taxable, and you don’t need to file a return. But if you have income from other sources as well, there may be taxes on the total amount.
To find if your benefits may be taxable, start with what’s called the base amount for your filing status, which is:
- $25,000 if you are single, head of household, or a qualifying widow(er)
- $25,000 if you are married filing separately and lived apart from your spouse for the entire year
- $32,000 if you are married filing jointly
- $0 if you are married filing separately and live with your spouse at any time during the tax year
To find out whether your Social Security benefits are taxable, divide your total Social Security benefit amount by 2, then add all your other income (including any tax-exempt interest). Compare the result to the base amount for your filing status. If your result is higher than the base amount for your filing status, you’ll probably be taxed on the total.
If you’re married and file a joint return, both spouses must combine their incomes and Social Security benefits when figuring taxable amounts. This applies even if the spouse did not have any benefits.
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