Most people file a tax return because they know they have to, but sometimes it makes sense to file even if you don't have to. In most cases, the amount of your income, your filing status and your age determine if you must file a return. For example, if you're single, under 65 and have taxable income of at least $10,300 you must file a return.
However, if you received your health insurance through your state's health insurance exchange (such as Covered California) or the federal health insurance exchange (HealthCare.gov) you must file a federal tax return to reconcile any advance payment credits you received and to determine your eligibility for an advance payment credit in the following year. If you fail to file you will get a reminder from the IRS to do so.
If you don't need to file a return because your income is below the filing threshold but your employer withheld federal or state income tax from your wages, you need to file returns to get a refund. This is a typical scenario for high school and college students. Because parents can still claim those students as dependents, it is critical that the student marks the box on their return indicating that they are the dependent of someone else. Failing to do that will significantly delay any refund due to the parents.
Wage earners with income below certain levels may be eligible for an Earned Income Credit. That credit can be worth thousands of dollars but you have to file a return to get it. The same holds true for the Child Tax Credit - you must file a return to get the credit. Finally, families with students in college may be eligible for an education credit of up to $2500 per student but must file a return to get the credit.
If you have any questions about whether you need to file a tax return or not, Turner's Tax Service can help you figure that out. Just call 530-626-8551 for a quick phone consultation.
However, if you received your health insurance through your state's health insurance exchange (such as Covered California) or the federal health insurance exchange (HealthCare.gov) you must file a federal tax return to reconcile any advance payment credits you received and to determine your eligibility for an advance payment credit in the following year. If you fail to file you will get a reminder from the IRS to do so.
If you don't need to file a return because your income is below the filing threshold but your employer withheld federal or state income tax from your wages, you need to file returns to get a refund. This is a typical scenario for high school and college students. Because parents can still claim those students as dependents, it is critical that the student marks the box on their return indicating that they are the dependent of someone else. Failing to do that will significantly delay any refund due to the parents.
Wage earners with income below certain levels may be eligible for an Earned Income Credit. That credit can be worth thousands of dollars but you have to file a return to get it. The same holds true for the Child Tax Credit - you must file a return to get the credit. Finally, families with students in college may be eligible for an education credit of up to $2500 per student but must file a return to get the credit.
If you have any questions about whether you need to file a tax return or not, Turner's Tax Service can help you figure that out. Just call 530-626-8551 for a quick phone consultation.
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