If you don’t work, you don’t have to file –FALSE

Failing to file your taxes is a crime. Refusal to file your taxes can be a form of tax evasion. Nevertheless, those who do not work may not have to file tax returns.

You can choose to forgo filing your tax return if you have little or no income. To be clear, this is not a blanket rule; many people who make little or no income whatsoever are still recommended to file their taxes.

People who don’t work who may still need to file

There are many different types of people who do not work – spouses who stay at home with their children, students, or those who are legitimately unemployed. These three groups, despite not working, still need to complete some form of filing or documentation.

For those who are married and do not work, typically, you have to file a joint return based on your spouse’s income. In the case of students, depending on your situation, you might have to file a return to record your income for financial aid purposes, or grants and stipends.

By definition, someone who is unemployed is not working. Nonetheless, if you receive unemployment benefits, you will need to file a tax return. You will also need to pay taxes on your unemployment benefits regardless if you worked at all that tax year.

What if you made a small amount of income?

The IRS designates a minimum amount of income – should you fall below that amount, you do not need to file a tax return.

This minimum varies for each person and is based on several factors, such as your age and filing status.

For example, if you make at least $400 through any means classified as self-employment, you will need to file a tax return.   

Other instances where you should file

 In the event that you have unearned income, like interest and dividends from investments, you should file a tax return. Likewise, you should file if you owe the IRS money in the form of unpaid taxes, uncollected Social Security, or Medicare.

One final point of consideration; the IRS recommends that everyone, no matter if you don’t need to file, should document any significant financial records.

If you need assistance filing your taxes or resolving unfiled taxes, you can contact a TaxRise specialist at 833-419-RISE (7473).

Any new or systemic Liens and/or Levies will also be suspended for the time being.

For taxpayers who are considered “seriously delinquent”, the IRS will suspend any new certifications for the remaining period. Any taxpayer who falls into this category in reminded and encouraged to enter into an Installment Agreement or apply for an Offer In Compromise.

The IRS will not forward any new delinquent accounts to private collection agencies at this time.

Taxpayers have until July 15, 2020 to verify to the IRS they are qualify for the Earned Income Tax Credit or to confirm their income. If the taxpayer is unable to verify their credentials or provide appropriate documents for this credit, they are encouraged to notify the IRS before the deadline. No cases will be denied this credit for failure to provide requested information until July 15.

Case workers will continue business as usual. However, most case work will be conducted remotely (video/over the phone conferences). Any requests for documentation sent by the Office of Appeals should be responded to in a timely manner to ensure a smooth process.

The IRS will continue to take the appropriate measures to stay compliant and protect the applicable statutes of limitations. In situations where certain statutes may be compromised, taxpayers are encouraged to extend such statutes. Otherwise, Notices of Deficiency will be issued by the IRS and similar actions will be pursued to protect the interests of the government in preserving such statutes. Where a statutory period is not set to expire during 2020, the IRS is unlikely to pursue the foregoing actions until at least July 15, 2020.

Practitioners are reminded that PPS wait times may be significantly longer, depending on staffing levels and allocations going forward. The IRS will continue to monitor this as situations develop.

“The IRS will continue to review and, where appropriate, modify or expand the People First Initiative as we continue reviewing our programs and receive feedback from others,” Rettig said. “We are committed to helping people get through this period, and our employees will remain focused on these and other helpful efforts in the days and weeks ahead. I ask for your personal support, your understanding – and your patience – as we navigate our way forward together. Stay safe and take care of your families, friends and others.”

Learn how easy it is to qualify for tax savings.

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