Each year, the IRS establishes an income threshold that determines whether or not you legally need to file a tax return. If you fall below that threshold, you do not need to file a return and there would be no legal repercussions. But if you are registered as a taxpayer, it is important to file each year even if you made no income. The process for filing a no income tax return is not much different than one with income, and the reasons are very sound for doing so.
Finding The Income Threshold
You can visit the IRS website at IRS.gov to find out the annual income threshold for filing a tax return. If you cannot find it on the IRS website, then you can call the IRS and get that information. Sometimes it can take a while to get through to the IRS, so you could call a tax accountant to get the information if you do not feel like waiting for the IRS.
How To File A No Income Return
If you finished the year with zero income and have no outstanding W-2 or 1099 forms to say otherwise, then you can file a zero income return by simply using zero as an income. But when you file a zero income return, be sure that you do not abuse any deductions such as home repairs, charitable donations or legal expenses. The IRS will become extremely suspicious if your file a zero income return that turns into a large source of income for you.
Why You Should File A Zero Income Return
Any person who is a taxpayer in the United States should file a return every year regardless of their income. For one thing, you might have a refund coming your way through child tax credits and other credits that are applied even if you have no income. The IRS has rules to try and prevent zero income returns from turning into a windfall for the taxpayer, but if you follow the laws then you might get a nice refund.
One of the audit triggers for the IRS is not filing a return for a given year. Even if you have nothing to hide, an IRS audit can be a difficult process that could take months and even cost you money. To avoid that kind of problem, you should file a zero tax return.
Best Way To File A Zero Tax Return
If you want to file your zero income tax return and reduce suspicion from the IRS, then you should have your taxes done by a tax professional. You might not get anything in return, but he costs and hassles you would avoid by not having to deal with an audit would make the cost of a tax professional worth it.
Every American tax payer should file a tax return every year, even if they have a zero income. You should rely on the experience of a tax professional to help you present a zero tax return to the IRS that will not draw suspicion and help you collect and refund you are due.
Jim Treebold is a North Carolina based writer. He lives by the mantra of “Learn 1 new thing each day”! Jim loves to write, read, pedal around on his electric bike and dream of big things. Drop him a line if you like his writing, he loves hearing from his readers!