Do You Have to File Taxes If You Have No Income?

You may be able to skip filing a tax return if you don’t have much income

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Federal law doesn’t require you to file a tax return if you didn’t earn any money during the previous tax year. This might be the case even if you did earn some money but your earnings were less than the amount of that tax year’s standard deduction.

So why bother filing a tax return if there’s no income left after you subtract the deduction? There are a few reasons why you might want to do so, even if you don’t technically have to. For starters, you could be leaving money on the table. Here’s what to consider before deciding not to file a tax return.

Income Thresholds for Federal Taxes

The amount of the standard deduction varies by filing status, and it’s usually adjusted each year to keep up with inflation. Every taxpayer is entitled to subtract the standard deduction from their income, so they’re only taxed on what remains.

Below are the standard deductions for each filing status for tax years 2020 and 2021. You generally have to file a tax return if your income was more than the deduction for your filing status unless you’re over the age of 65 or other rules apply (more on that below).

Filing Status Tax Year 2020 Tax Year 2021
Single $12,400 $12,550
Married filing jointly $24,800 $25,100
Married filing separately  $12,400 $12,550
Head of household $18,650 $18,800
Qualifying widow(er) $24,800 $25,100

While the IRS states that the standard deduction for married individuals who file separately is the same as those who are single, this doesn’t necessarily determine whether or not you need to file. That’s because the IRS states that married individuals who file separately each need to file a return if they earn even just $5. This income threshold applies to married couples of all ages.

Taxpayers who are age 65 or older may have a little more leeway because they’re entitled to an extra standard deduction. Below are the standard deductions for tax years 2020 and 2021 for those 65 or older. 

Filing Status Tax Year 2020 Tax Year 2021
Single $14,050 $14,250
Married filing separately $14,050 $14,250
Married filing jointly if one spouse is age 65 or older $26,100 $26,450
Married filing jointly if both spouses are age 65 or older $27,400 $27,800
Head of household $20,300 $20,500
Qualifying widow(er) $26,100 $27,800

A taxpayer may be able to file as a qualifying widow(er) for two years after the death of their spouse if they have a dependent child. This status has the same threshold as those who are married filing jointly, whether over 65 or not. Some other rules may apply.

What If Someone Else Can Claim You as a Dependent?

Different income thresholds apply if someone else can claim you as a dependent. Your total income might be less than the standard deduction for your filing status. However, you will still need to file a tax return if you’re single or head of household, and one of the below apply:

  • $1,100 in unearned income, under age 65, and not blind
  • $2,750 in unearned income, age 65 or older, or blind
  • $4,400 in unearned income, age 65 or older, and blind
  • $12,400 in earned income, under age 65, and not blind
  • $14,050 in earned income, age 65 or older, or blind
  • $15,700 in earned income, age 65 or older, and blind

You must also file a tax return if your combined unearned and earned income exceeds either of the applicable amounts for your circumstances. For example, you would have to file a return if you had $1,101 in unearned income, even though you only had $10,000 in earned income, were single and were under 65 last year. (See “What Counts as Taxable Income?” below to learn more about what qualifies as earned and unearned income.)

The numbers change a bit and more rules apply if you’re married or a qualifying widow(er):

  • $1,100 in unearned income, under age 65, and not blind
  • $2,400 in unearned income, age 65 or older, or blind
  • $3,700 in unearned income, age 65 or older, and blind
  • $12,400 in earned income, under age 65, and not blind
  • $13,700 in earned income, age 65 or older, or blind
  • $15,000 in earned income, age 65 or older, and blind

Again, you must file a tax return if your combined unearned and earned income exceeds either of the applicable amounts. For example, you would have to file if your gross income was more than $1,100 or more than $12,400 if you’re unmarried and under the age of 65. The $5 rule for married taxpayers filing separate returns still applies, as well.

The IRS provides an interactive tool on its website that can help you determine if you need to file a tax return. It’s only designed for taxpayers who lived in the U.S. throughout the entire tax year. Your spouse must also have lived in the U.S. if you’re filing a joint return.

Other Filing Requirements

Some individuals must file regardless of whether their earnings exceed the amount of the standard deduction to which they’re entitled. Undocumented immigrants, or “nonresident aliens” as the IRS states on its website, must typically file if they engage in any U.S. trade or business during the tax year.

You must also file if you owe any sort of additional tax, such as:

  • The alternative minimum tax
  • The “nanny tax” for household employees
  • Taxes on tips that you didn’t report to your employer
  • Additional tax on any qualified retirement plans or health savings plans you contributed to  

You must also file a tax return if you had both self-employment income of a certain amount and wages paid by a church or a qualified church-controlled organization that didn’t have to contribute Social Security or Medicare taxes on your behalf. For tax year 2020, these amounts are $400 and $108.28, respectively.

You must file if you received distributions from certain health savings or medical savings accounts. You also must file if you claimed the Premium Tax Credit on a previous year’s tax return and the money was issued in advance to your insurer. 

This list isn’t all-inclusive. You should check with a tax professional if you received any unusual means of income during the tax year that may require you to file a return. 

What Counts as Taxable Income?

All these thresholds and limits are based on earned and/or unearned income. Earned income typically comes from salaries, wages, or self-employment. Unearned income derives from things like interest and investment gains. But some common types of income fall outside these parameters, so “gross” income rules apply. Gross income is your earned and unearned income added together. 

Unemployment compensation is generally included in gross taxable income, except during 2020. If you collected unemployment benefits in 2020, the first $10,200 will not be taxed when you file in 2021, thanks to the American Rescue Plan Act. This is a one-year provision only, created in response to the ongoing global health crisis. Unemployment benefits over the first $10,200 will count toward your gross taxable income.

The Economic Impact Payments (EIPs) that were sent out in 2020 and 2021, affectionately known as stimulus payments or stimulus checks, are not taxable income. They don’t contribute to your earned or unearned income thresholds.

Social Security benefits are only taxable if your benefits, gross income, and tax-exempt interest combined exceed $25,000 if you’re single or $32,000 if you’re married and filing a joint return. Married taxpayers who file separate returns may have to pay taxes on that income, as well. You also must report and pay taxes on all your benefits if you lived with your spouse at any time during the tax year.

Why You Might Want to File Even If You Didn’t Have Taxable Income

All these rules apply when you are required to file a tax return, but there are a few good reasons why you might want to file even if you technically don’t have to. 

You may be eligible to claim the Recovery Rebate Tax Credit if you or one of your dependents were entitled to a stimulus check but never received it. You’re effectively letting the IRS keep that money unless you file a return to claim this as a tax credit.  

The same applies to any other refundable tax credit you might be qualified to claim. You won’t get that money unless you file a tax return to claim it.

State Income Taxes 

The rules outlined above apply to federal taxes. Most states impose income taxes, as well, and the rules about who has to file can be significantly different. Check with your state’s Department of Taxation for the rules that apply in the state where you live or work. 

You won’t have to worry about this, however, if you live or work in Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington state, or Wyoming. These states don’t have an income tax as of 2021. Tennessee used to tax unearned income, but this tax is no longer effective as of 2021. And if you live or work in New Hampshire, you will only be taxed on dividend and interest income.