Who Is Required to File?

In some cases filing is unnecessary even when the individual earned income during the year. Here is the criteria that specifies if someone is required to file. If any of the following situations applies to customers, they will need to submit a tax return:

  1. Filer is entitled to the Earned Income Tax Credit (EITC).
  2. They are self employed and earned over $400.
  3. They sold their home.
  4. Owe taxes on a qualified retirement plan, including IRAs and MSAs.
    This applies if they: received an early distribution from a qualified plan; made excess contributions to your IRA or MSA; were born before July 1, 1938, and did not take the minimum required distribution from your qualified retirement plan; or received a distribution in the excess of $160,000 from a qualified retirement plan.
  5. Owe social security and Medicare tax on tips which were not reported to an employer.
  6. They qualified for the Alternative Minimum Tax (AMT).
  7. Owe a recapture tax.

There is also a requirement to file if someone makes over a certain income, which changes based on status. For example single filers under 65, in the year 2020 must file if income is above $12,400, for married filing jointly it is double to $24,800. Dependents and married filing separately have much lower thresholds. The exact amount which requires a return is adjusted each year to keep up with economic conditions. This amount also depends upon the age and filing status of the tax payer and if they can be claimed as a dependent or not. For more information on specific income requirements see this publication.

Of course, if the person desires to receive a refund due to them they must also file even if they would otherwise not be required to.