{"id":19215,"date":"2025-01-09T15:32:23","date_gmt":"2025-01-09T15:32:23","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/finance\/ira-social-security-income-tax-and-all-things-financial-4\/"},"modified":"2025-01-09T15:32:23","modified_gmt":"2025-01-09T15:32:23","slug":"ira-social-security-income-tax-and-all-things-financial-4","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=19215","title":{"rendered":"IRA, Social Security, income tax, and all things financial"},"content":{"rendered":"


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Photo credit: jb<\/p>\n<\/div>\n

Have you ever wondered if it was actually necessary to file a tax return? Perhaps your income is relatively low, and so you wonder if it\u2019s really required of you to file a return.<\/p>\n

Often it\u2019s not entirely a case of a return being required, but rather it might be in your best interest to file a return in order to receive certain credits against your income. The IRS has an interactive tool that you can use to determine if it\u2019s necessary for you to file a tax return. You can find this tool at www.irs.gov\/help\/ita\/do-i-need-to-file-a-tax-return<\/span><\/a>. As of this writing, the tool has not been updated to help for 2024 tax returns \u2013 expect an update in the coming weeks. In the meantime, read on for some guidance that may help.<\/p>\n

Do I Need to File a Tax Return This Year? <\/strong><\/h3>\n

To determine whether you need to file a tax return, you need a few things:<\/p>\n

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  • Filing status.<\/li>\n
  • Federal income tax withheld.<\/li>\n
  • Basic information to help you determine your gross income.<\/li>\n<\/ul>\n

    You are required to file a federal income tax return if your income is above a certain level, which varies depending on your filing status, age and the type of income you receive. However, the Internal Revenue Service reminds taxpayers that some people should file even if they aren\u2019t required to because they may get a refund if they had taxes withheld or they may qualify for refundable credits.<\/p>\n

    The amount of income that a couple filing jointly (filing status Married Filing Jointly) with only the Standard Deduction without needing to file is $29,200 for 2024. For single folks (filing status Single) using the Standard Deduction, the amount of income is $14,600 for 2024. These are only general rules of thumb, if you\u2019re near that level of income you\u2019ll want to do some more research to be sure. If you\u2019re over age 65, for example, there is an additional exemption allowed which will increase the non-taxed income.<\/p>\n

    To find out if you need to file, check the Individuals section of the IRS website at www.irs.gov<\/span><\/a> or consult the instructions for Form 1040 or 1040SR for specific details that may help you determine if you need to file a tax return with the IRS this year. You can also use the Interactive Tax Assistant available on the IRS website. The ITA tool is a tax law resource that takes you through a series of questions and provides you with responses to tax law questions.<\/p>\n

    Even if your income is low enough that you don\u2019t have to file for 2024, here are five reasons why you may want to:<\/p>\n

    1. Federal Income Tax Withheld<\/strong> If your income is below the standard deduction amount, you should file a return to get money back if your employer withheld federal income tax from your pay, you made estimated tax payments, or had a prior year overpayment applied to this year\u2019s tax.<\/p>\n

    2. Earned Income Tax Credit<\/strong> You may qualify for EITC if you worked, but did not earn a lot of money. EITC is a refundable tax credit; which means you could qualify for a tax refund even if you don\u2019t owe any tax. To get the credit you must file a return and claim it.<\/p>\n

    3. Additional Child Tax Credit<\/strong> This refundable credit may be available if you have at least one qualifying child and you did not get the full amount of the Child Tax Credit.<\/p>\n

    4. American Opportunity Credit <\/strong>Students in their first four years of postsecondary education may qualify for as much as $2,500 through this credit. Forty percent of the credit is refundable so even those who owe no tax can get up to $1,000 of the credit as cash back for each eligible student.<\/p>\n

    5. Premium Tax Credit<\/strong> If you buy health insurance through the Health Insurance Marketplace and meet other criteria, you may be able to claim the Premium Tax Credit. This is a refundable credit based on your income and the cost of your healthcare plan.<\/p>\n

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