What if I Don't Earn an Income? Do I Still File a Tax Return?

1040 Tax Forms

If you didn't earn any income in the last tax year, you're not obligated to file a tax return. The IRS has minimum income requirements that change annually based on inflation as well as your tax status, such as single, married filing separately or jointly, head of household, etc. When you fall below the threshold, you are not required to file a federal tax return. There are, however, some good reasons to file even when you earn little or no income.

If you had very low or no income last year and are not required to file, you may wish to file anyway to claim certain refundable tax credits. Refundable tax credits can provide you with a tax refund even when you do not work. For example, you may qualify for the Earned Income Tax Credit or the Additional Child Tax Credit, which are refundable tax credits.

Even if you earned very little last year, you might wish to file a tax return simply to get back any taxes withheld from your pay. This usually happens when a taxpayer is employed for only a small part of the calendar year. Also, if you're attending college or a higher education program and earn little or no income, you may wish to file a return to take advantage of the American Opportunity credit.

If you own a small business or are self-employed, please keep in mind that the rules for you are different. You must file a tax return if you earned more than $400 from self-employment efforts in the last year. There is sometimes taxpayer confusion with this, when a contractor's income level is above $400 but below the threshold that W2 employees are required to file at. For example, you'll need to file and pay self-employment tax if you ran an income-generating website or worked as any sort of independent contractor and received a 1099(s) with at least $400 of earnings during the year.

If you received any health care tax credits or subsidies for the past tax year, you'll need to file to keep receiving them, even if you normally wouldn't be required to file. For more on this please see our article on the Affordable Care Act

If you earned little or no income last year you can likely file your federal return with E-file.com free of charge this year. To take advantage of this simply create an account here, enter your information and let our software do the calculations for you.

Quiz: Who Needs To File?

True or False: If your total income is less than the standard deduction for your filing status plus one personal exemption for that year, you don't have to file a tax return. Answer
True with some caveats. You must determine the correct filing status to use, and add the standard deduction for that status and tax year to the personal exemption amount for the same tax year. If your income is under this amount, you generally won't have to file. There are exceptions, including if you have self-employment income exceeding $400 after expenses and if you received any unemployment benefits.

What age changes the gross income filing requirement? Answer

A. 21
B. 35
C. 65
D. 71

C, age 65. The gross income threshold increases once you and/or your spouse turn 65. The threshold is different for when one spouse is 65 and when both are 65.

Which of the following situations would require you to file a tax return no matter how much your income was? Answer

A. You received taxable unemployment benefits
B. You received advance premium tax credits (APTC) on marketplace health insurance plans
C. You are self-employed and had at least $400 in net earnings
D. All of the above

D, all of the above. There are other situations that would require you to file a tax return in addition to the reasons listed here, but if you meet any of these conditions, you must file a tax return.

True or False: If you can be claimed as someone's dependent, then you don't need to file a tax return. Answer
False. Dependents are subject to a different set of rules. Since someone who is claimed as another taxpayer's dependent can't take their own personal exemption and has a different standard deduction as well, the gross income filing requirement is different for dependents.

True or False: There are financial and administrative benefits to filing a tax return, even if you are not required to do so. Answer
True. You may be due a tax refund of excess taxes withheld from your paychecks as well as benefits like the Earned Income Tax Credit, Premium Tax Credit and Additional Child Tax Credit. Third parties such as state governments, universities, and financial institutions also use previously-filed tax returns to determine eligibility for financial aid, loans, housing, government benefits and more.

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