Do I Need to File Taxes?

Susannah Snider

For many Americans, filing taxes is a no-brainer. Failing to do so can cause them to miss out on valuable tax refunds or burden them with late fees and failure-to-file penalties.

But for Americans with low incomes or without any earned income at all, the decision to file is more complicated.

So should you file your taxes? Here are the income levels required to file taxes -- and advice from experts on the best action to take.

[See: 9 Red Flags That Could Trigger a Tax Audit.]

How Much Do You Have to Make to File Taxes?

Filers who earn taxable income of less than the standard deduction don't typically need to file a federal tax return. But if they earned income during the tax year and had taxes withheld from their paychecks, it's likely a good idea to run their information through a tax software program and see if they're due a refund.

Here are the basic standard deduction amounts for 2019:

Filing status Standard deduction for 2019
Single $12,200
Married filing jointly $24,400
Married filing separately $12,200
Qualifying widow or widower $24,400
Head of household $18,350

Also, there are additional 2019 standard deduction amounts for filers who are age 65 and older or blind. These are added to the basic standard deduction and can be doubled for those who are both blind and above the age threshold:

Filing status Additional 2019 standard deduction amount
Single $1,650
Married filing jointly $1,300
Married filing separately $1,300
Qualifying widow or widower $1,300
Head of household $1,650

Remember that if you're not required to file taxes, you may still want to go through the process. "Even if your income falls below one of the standard deduction levels, if you are employed and your employer is withholding taxes, you're certainly entitled to get a refund for that," says David DuFault, attorney at Sodoma Law in Charlotte, North Carolina.

In fact, low-income filers may be eligible for valuable tax credits such as the earned income tax credit or child tax credit, which are refundable, meaning they can actually be worth more than you owe in taxes. Failing to claim these credits is like leaving money on the table.

Additionally, low-income filers should be eligible to file their taxes for free through the IRS-partnered Free File Alliance, which offers free private-industry software to filers earning $69,000 or less in 2019 adjusted gross income. "At least run through the tax return, and then decide whether you need to file or not," says Mark Luscombe, Chicago-based principal tax analyst at Wolters Kluwer Tax & Accounting.

[See: 15 Tax Questions -- Answered.]

Income Levels Required to File

You're not typically required to file taxes unless your income levels exceed the standard deduction amount. Again, it may be worth filing if you've had taxes withheld from a paycheck, you anticipate taking advantage of refundable tax credits or you expect a refund.

Here is the 2019 minimum gross income required to file taxes:

Younger than 65: $12,200
65 or older: $13,850

Married filing jointly:
Both spouses younger than 65: $24,400
Both spouses 65 or older: $27,000
One spouse 65 or older: $25,700

Married filing separately:
All ages: $12,200
Both spouses 65 or older: $14,800
One spouse 65 or older: $13,500

Head of household:
Younger than 65: $18,350
65 or older: $20,000

Qualifying widow or widower:
Younger than 65: $24,400
65 or older: $25,700

These amounts can be increased if you qualify for an additional standard deduction due to blindness.

Dependents. Knowing whether to file taxes as a dependent will depend on the amount and type of income you receive.

Dependents who have earned income, such as wages, may need to file if they earn more than the standard deduction amount of $12,200 for single filers including any relevant additions. A tax return may be required for dependent children under age 19 (or 24 if a full-time student) who rake in more than $1,100 in unearned income, such as interest and dividends, in 2019. Even more complicated, dependents under the age threshold who report both earned and unearned income can claim a standard deduction of $1,100 or earned income plus $350 (up to $12,200), whichever is greater.

College students. If you're questioning whether to file taxes as a college student, it requires some coordination with Mom and Dad. You'll first need to determine whether they are claiming you as a dependent. "It's good to clarify with your parents what their intentions are," Luscombe says.

If your parents aren't claiming you as a dependent, and you earned income from a part-time or on-campus job, filing a tax return may be wise or required, especially if you made more than the standard deduction. You may need to file if you earned more than $400 in self-employment income, Luscombe says.

Those who file may find they're owed a refund or can claim education-specific tax credits, such as the American opportunity tax credit, or AOTC, a credit their parents may earn too much to claim. The AOTC is worth $2,500 for the 2019 tax year. It's a refundable credit, which means if it brings your taxes owed to zero, you can have up to $1,000 refunded to you.

Retiree requirements to file taxes: The way your money is taxed in retirement will vary depending on your financial situation and the accounts from which you're withdrawing retirement funds.

For some retirees, it's entirely possible to arrange a situation in which their modest income from Social Security benefits and post-tax investment vehicles, such as a Roth IRA, cause them to owe nothing at tax time and they do not need to file a tax return.

Then again, other retirees may have taxes due on Social Security or investment withdrawals, depending on their income and investment vehicles. So it's worthwhile to run your financial data through a tax software program or by your tax preparer if you're questioning whether you need to file.

Remember: If you're age 65 or older, your standard deduction cutoff is a little higher than it is for other filers -- $13,850 for single filers and $27,000 for married filing jointly.

[Read: 10 Tax Write-Offs You Shouldn't Overlook.]

What Happens if I Don't File Taxes?

Neglecting to file taxes will have different implications depending on whether you owe taxes or are due a refund. If Uncle Sam owed you money, failing to file will cause you to abandon the money you could've collected. On the flip side, if you owed taxes, you could be required to pay failure-to-file, failure-to-pay and interest penalties on your overdue tax bill.

So it's important to understand whether you owe the IRS and walk through a tax return, even if you don't eventually need to file it. If you realize you neglected to file taxes when you should have in previous years, you can file back taxes. Those will allow you to claim refunds from up to three years prior and settle up on overdue tax bills going back even longer than three years.

Keep in mind, too, that your state may have its own rules surrounding filing taxes, so check to make sure you're not running afoul of any state laws if you decide not to file.