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:
- $5 for all ages
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.
