Tax season can be a stressful time for many, but what if you had no income for the year? Do you still need to file a tax return? The answer might surprise you. In this comprehensive guide, we will explore the ins and outs of tax filing with no income, including the reasons why you might want to file anyway, and the steps to do so.
Do I Need to File Taxes If I Have No Income?
Typically, if you had zero or minimal income during the year and did not earn enough money that requires you to file a tax return for that specific year under Internal Revenue Service (IRS) guidelines, then there is no requirement for filing a federal tax return in most cases. However, even if your earnings are below the threshold for requiring submission of a federal income tax return, many states require taxpayers facing particular circumstances like property owners to pay local taxes regardless of any minimum earning thresholds.
Reasons Why You Might Want To File Anyway
Even if you don’t have any income, there might be several reasons why you would want to file a tax return. These include claiming refundable credits, reporting self-employment earnings, and applying for government benefits.
Claiming Refundable Credits
The United States government offers certain credits that are only applicable upon submitting returns, even if you made little during the year. These refundable credits could possibly add up to several thousands, giving you a head start on income for the year.
Reporting Self-Employment Earnings
If you’re self-employed and report little income, it is encouraged to file tax returns outlining profit and losses. This information might be needed in the future while seeking benefits or loans related to investments in your business venture.
Applying for Government Benefits
Some government benefits such as food stamps and income-based housing assistance programs require applicants to submit documented proof of no earning. Filing taxes with no income becomes essential when applying.
Steps To File Taxes With No Income
If you choose to file a tax return despite having no income, there are several steps you should follow. These include collecting your personal information, gathering tax documents, and starting the filing process.
Step 1: Collect Your Personal Information
To fill out your non-filer form, you need some basic personal information like your name, current address, and contact details. Confirm that these details correspond exactly with those provided during account opening.
Step 2: Gathering Tax Documents
Despite having little or zero taxable income, all legal documents received over the preceding years which may contain other necessary reporting figures must be available for referencing while filling out exemption options.
Step 3: Start Filing Your Non-Filer Tax Form
File your tax refund through either TurboTax or the IRS website by selecting and submitting credits that might apply.
While not earning taxable income doesn’t obligate taxpayers towards filing their returns, special instances such as government benefits applications require proof of no-earning requiring non-income earners to file tax forms with zero earnings in order an individual may claim refunds as well as certain refundable credits.