Monday 11th of December 2017 12:28:22 AM

  • Should I File a Tax Return?

    Wednesday 14th of November 2012 10:56:11 AM

    Some people may not be aware of this but in some cases filing a federal tax return is not necessary.  Many factors way in on this but it has to do with more than just how much income you have taken in over the year in addition to your filing status, age and the type of income you made.  In some cases even if you are not required to file it is advised that you still do because there may be a refund waiting for you.  I’m sure we can all use the extra cash.  You may even qualify for refundable credits.

    On the IRS website you can find many tools to help you figure out whether filing a tax return is necessary.  If you use the Interactive Tax Assistant on the IRS website you will be answering a series of questions to help determine if filing is applicable to you.

    As mentioned before, even if you don’t have to file you may want to file for six major reasons: Federal income tax withheld, Earned Income Tax Credit (EITC), Child Tax Credit, American Opportunity Credit, Adoption Credit and Health Coverage Tax Credit.

    For the case of Federal Income Tax Withheld it is advisable to file in order to retrieve any taxes that may have been held by your employer, if you were making estimated tax payments or overpayment from the prior year’s tax return.

    If you qualify for EITC you will receive a refundable tax credit.  To receive a refund you must file your tax return.  Same theory applies to the Additional Child Tax Credit except you must have at least one qualifying child.

    Students that are in their first four years of postsecondary education can qualify for credit up to $2500.00 of which 40% is refundable.  This means that even if you don’t owe any taxes you will receive $1000.00 cash back for all eligible students.

    If you have adopted a child then you may also receive a refundable tax credit to cover any expenses you paid to adopt a qualified child.

    Lastly, eligible tax payers may also receive a refund on payments made to health insurance premiums.

    For more information about filing please visit the IRS website.

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