For most adults, filing a tax return by the middle of April is a necessity but for those who don't make more than the minimum amount, tax season may be easy this year. That doesn't mean that you shouldn't file. Even if you don't have to pay taxes on the small amount of income that you earned, there are reasons why filing a return may still land you a refund.
There are also reasons that you may be required to file a return even if you didn't make more than the minimum income require to file a return. Here are a few credits that may result in a refund check even if you owe no taxes this year, as well as some alternate reasons as to why you may have to file regardless of the amount of money you made.
You Had Tax Withheld
If you're married and under the age of 65, you don't have to file a tax return if your household income is below $19,000. However, that doesn't mean that your employers didn't withhold taxes. Filing a tax return will produce a refund of those withholdings providing you have no other taxes due. It's as easy as completing a 1040EZ form in most cases, and companies like TurboTax will allow you to complete that form using their online software free of charge.
Earned Income Tax Credit
The Earned Income Tax Credit was set up by Congress to allow low wage earners the ability to hold on to more of their paycheck. If your tax obligation is less than the amount of the credit, you may be eligible for a refund of the remaining tax credit. To find out if you're eligible for this credit, click here.
Child Tax Credit
The IRS provides a credit for each dependent child for lower income earners. If your tax burden is lower than the maximum credit, you may receive a refund. In order to qualify, you have to meet certain requirements, which can be found by going to the IRS website.
American Opportunity Tax Credit
The American Opportunity Tax Credit reimburses up to a certain amount each year for qualified education expenses. This credit was expanded to allow those who do not owe any taxes to qualify for a refund even if they wouldn't have normally filed a return. If you paid college tuition or other qualified expenses but aren't required to file a return, this hefty tax credit may provide a sizable refund check. Check out this page of the IRS website to see if you qualify.
Other Reasons You Have to File
Even if you didn't make enough money to meet the IRS minimums, there are other reasons you may have to apply. If you were self-employed and earned more than $400, you sold your home, received distributions from a retirement account, owe social security or Medicare taxes on tips that you didn't report, or if you're subject to the alternative minimum tax, you may have to file a return. Be sure that you don't have to file a return or there could be IRS penalties if you have to file later.
The Bottom Line
Don't assume that because you didn't make enough money to file a return you shouldn't file. Many tax credits are available to you even if your tax bill will be zero this year. Some of the credits are more than $1,000 so taking the time to read about the credits available to you could result in a healthy refund check this year.