This may give you pause, but you just might not have to file federal income taxes for 2020. Your moderate salary, age, and marital status could be your ticket out. On the other hand, even if you are not required to file, there may be some benefit in doing so anyway. So, before you toss your W-2, let Laveniir help you decide—do you or don't you.
Each year, the U.S. government sets a certain threshold called a standard tax deduction. If your total income does not exceed it, then generally you don't need to file a federal tax return. The standard deduction, and other available deductions, reduces your income to establish how much of your income is taxable. If your income is less than the standard deduction, then you may be out of the woods.
1
So, what else could get you out of filing?
If you are younger than 65 AND single AND you earned less than the 2020 standard deduction of $12,400 AND you don't have special circumstances that require you to file, then there is no need to file. Some of these special conditions are:
- You are self-employed.
- You owe an excise tax on retirement plan assets.
- You owe Social Security and Medicare tax on tips that you did not report to your employer.
More than likely, you will be among the league of Americans rushing to beat the clock on April 15. You can find all the details in IRS Publication 501. Regardless of income, you'll generally have to file a tax return if:
- Your self-employment income is at least $400 net.
- You received distributions from a health savings account, Archer Medical Savings Account, or Medicare Advantage MSA.
- You owe taxes on an IRA, health savings account, or other tax-favored accounts.
- You owe taxes on household employees.
- You owe alternative minimum tax.
- You made more than $108.28 from a church or church organization.
- You owe recapture taxes.
- You owe Social Security or Medicare tax on tips you didn't report to your employer or that your employer didn't already take out of your pay.
- Advance payments of the premium tax credit were made for you, your spouse, or a dependent who got health coverage through the insurance marketplace.
- Advance payments of the health coverage tax credit were made for you, your spouse, or a dependent who got health coverage through the insurance marketplace.
- YYou owe 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.
