Do you have to file a tax return? A lot of people assume they don’t have to file a tax return because they didn’t earn much or “paid their taxes” as part of the withholding and don’t have to pay again. Generally you don’t HAVE to file a tax return if your income is not above a certain level, but you might WANT to file your taxes because you might be leaving money on the table here – you might want to claim a credit or a refund that you are due.
Here are some of the reasons listed by the IRS on why you might want to file your tax return even if you are not required to -
- Federal Income Tax Withheld You should file to get money back if Federal Income Tax was withheld from your pay, you made estimated tax payments, or had a prior year overpayment applied to this year’s tax.
- Making Work Pay Credit You may be able to take this credit if you had earned income from work. The maximum credit for a married couple filing a joint return is $800 and $400 for other taxpayers.
- Earned Income Tax Credit You may qualify for EITC if you worked, but did not earn a lot of money.EITC is a refundable tax credit; which means you could qualify for a tax refund.
- Additional Child Tax Credit This refundable credit may be available to you if you have at least one qualifying child and you did not get the full amount of the Child Tax Credit.
- American Opportunity Credit The maximum credit per student is $2,500 and the first four years of postsecondary education qualify.
- First-Time Homebuyer Credit The credit is a maximum of $8,000 or $4,000 if your filing status is married filing separately. To qualify for the credit, taxpayers must have bought – or entered into a binding contract to buy – a principal residence located in the United States on or before April 30, 2010. If you entered into a binding contract by April 30, 2010, you must have closed on the home on or before September 30, 2010. If you bought a home as your principle residence in 2010, you may be able to qualify and claim the credit even if you already owned a home. In this case, the maximum credit for long-time residents is $6,500, or $3,250 if your filing status is married filing separately.
- Health Coverage Tax Credit Certain individuals, who are receiving Trade Adjustment Assistance, Reemployment Trade Adjustment Assistance, or pension benefit payments from the Pension Benefit Guaranty Corporation, may be eligible for a Health Coverage Tax Credit worth 80 percent of monthly health insurance premiums when you file your 2010 tax return.
IRS.gov also has a nifty application – Interactive Tax Assistant, in a interactive interview pattern to tell you if you are missing out on any credits/refunds if you don’t file the return.
This application will help you determine if you have to file a federal income tax return. If you do not have to file a tax return, it will help you determine if you should file a tax return to claim any credit or refund that you are due.
Information You Will Need:
- Citizenship status and filing status
- Knowledge of any income you have from outside the United States
- Federal income tax withheld
- Basic information to help you determine your gross income
There are several ways to free e-file. If you are simply have a refund due without using any credits, then you can start your free e-file now. But if you are claiming any itemized deductions or credit, IRS will start accepting your tax returns from February 14th after dealing with income tax filing delays. So if you are due a credit/refund, it is an easy job to get your money back.
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