What's The Minimum Income To Pay Taxes? You Might Be Off The Hook
Filing taxes is pretty stressful. You have to find the right forms, fill out the right information, deduct the right things. It's a lot of "rights" to dig through, and who really wants to deal with that? No one. But before getting stressed, you should probably figure out what's the limit to pay income tax, because you might not have to file at all.
Depending on what your financial situation is, you might not make the minimum amount of income that requires you to file taxes. According to the Internal Revenue Service (IRS), the 2018 minimum income requirement for people 65 and under is $12,000 gross annual income for a single person, and $24,000 if married and filing jointly — that's $24,000 combined. And remember, "gross" is before taxes are taken out of paychecks, so make sure you're checking the right number.
If you're reading this and thinking, "hey, I don't have to file," you might want to hold off on your happy dance. If there's any chance your parents might be claiming you as a dependent, you might want to ring them up and ask. If they are, then you might need to file anyway since the rules are a little different when it comes to dependents. If you fall in the dependent category, then you'll need to file if you reach a minimum of $12,000 in earned income — which includes things like salary, wages, and even tips — or at least $1,050 in unearned income — things like interest from a savings account or bonds. On the other hand, it's possible for your parents to include your income on their own taxes, if all that applies. Basically, make sure you're getting all this down if your parents are planning to put you down as a dependent.
There's one more group of people who may have to file even if they aren't dependents and don't reach the income requirements, and those people are the self-employed. If you are self-employed (or if you are a freelancer with a 1040 tax form) and you made at least $400, then you'll have to file a tax return, according to the IRS. Good luck.
If you thought you escaped, albeit narrowly, the harrowing journey of filing your taxes, I have another bit of information to lay on you. Even if you haven't hit all the above requirements, you might want to file anyway on the chance you'll get a tax refund. If wages have been withheld from your paychecks over the year then you might be entitled to money back — a tax refund — even if you didn't hit the income requirements, according to The Balance. If you don't file a tax return, then the IRS will just keep all that money.
Who and who shouldn't file taxes can get a little confusing, especially if it's your first time out of the gate. Luckily, the IRS has a handy chart that outlines all the requirements for filing taxes. If you're still having trouble digging through all the details, the IRS has a super easy-to-use tool to help you out. Just head to their site and click "Do I need to file?" From there you will be guided through some simple questions to help determine whether or not you need to file a tax return.
Tax stuff is confusing and money is no fun when it comes to figuring out if you owe some of it. But don't sweat it, you now you have all the info you'll ever need on whether or not you should file taxes. So go forth and prosper, and don't miss the April 15 due date.