If you are registered as a taxpayer, you are required to file the income tax return every year even if you don’t earn any income throughout the year. However, when can you file taxes with no income is the real question here.
In this guide, we will discuss the whole concept of filing income taxes and if it is necessary to file a tax return for college students.
- Who All Are or Not Required to File Taxes?
- How to File Taxes with No Income?
- Can a College Student File Taxes with No Income?
- When Can You File a Tax Return with No Income?
Who All Are or Not Required to File Taxes?
The Internal Revenue Service (IRS) sets up the threshold for income every year. This income threshold determines if you should file the income tax return or not. According to the IRS rule, if anyone falls below the threshold, they do not file the income tax return. Also, there will not be any bad consequences.
However, if you have registered yourself as a taxpayer, it becomes essential for you to file the income tax every year even if you make no income during the year.
What is the Income Threshold?
To know what income threshold has been set by the IRS, you can visit the IRS.gov website. In case you are not able to find out the details then you can contact the IRS directly to get the income threshold information.
Connecting with the representative may take a long time. Hence, contacting your tax accountant will be quite helpful.
How to File Taxes with No Income?
If you made no income during the year and have form no 1099 or outstanding W-2 forms then you should file the zero income return. All you need to use Zero as your income when filing the income tax.
However, when filing the zero income tax return, you need to make sure that you don’t abuse the deductions such as charitable donations, home repairs, or legal expenses.
Must Read: How to File an Amended Tax Return?
Why Do You Need to File Zero Income Tax Return?
As stated earlier, every taxpayer is required to file an income tax return every year even if they have not made any income during the year. By doing so, you might get a refund even if you are not having an income. This can be possible through the child tax credits or other credits that are implemented.
The Internal Revenue Service (IRS) tries to prevent zero income tax returns. But, if you are following the rules correctly, you may get a decent refund.
One has to be aware of the audit triggers. Even when you have nothing to hide, the IRS audit process can be tough. It may take months and can cost you money.
What is the Best Way to File for Zero Tax Return?
When filing an income tax return, if you want to prevent any suspicion from the IRS then you should consult or take help from tax professionals. You probably get nothing in return rather the professional may cost you some money. However, taking help from professionals, you would not have to deal with the audits. This in turn makes the tax professional cost worth it.
Can a College Student File Taxes with No Income?
A lot of college students have this concern if they should file the income tax return during the tax year. Some colleges make it necessary to file tax returns whereas in other colleges this is optional.
If you are thinking about how to file a tax return with no income as a college student, we will enlighten you on this.
Do Students Require to File Income Taxes?
Filing the income tax return depends on various factors. It may include your gross income. The parents or guardians can also claim you as a dependent.
According to the Internal Revenue Service, if you are being considered as a dependent, you should comply with the following factors:
- Your parents can claim you as a dependent until you reach the age of 19. In case you are a college student then it can be extended by the age of 24.
- When you live with your parents beyond six years.
- When you do not give half of the support for a year.
In case you are a dependent, you still need to file a tax return. However, it is based on your income. For the tax year 2019, you are required to file a tax return if you meet the following criteria:
- When the unearned income was up to $1100.
- When the earned income was up to $12,200.
- Also, the gross income was more than $1100 or the earned income was more than $11850.
If you as a student fall under these thresholds then it is not required to file an income tax return. However, filing the tax return even when not reaching the threshold won’t be a bad idea.
How to File Taxes with No Income for a College Student?
If you are a student and want to file the tax return then it is important to pick the right form. For college students, Form 1040 can be used to file a tax return. Using this form, you can report the income for the whole year. It may also include the filing status including dedication, and tax credits that want to claim.
Other Forms You Need to File
W-2 Form: The employer sends this form to you. Using this form, you can document the income of the whole year including taxes if withheld from the paycheck.
Form 1098-T: Academic institutions send this form to students who pay qualifying expenses through the year. It includes the tuition, course materials, and fees. By using this form, you can report your paid expenses so that you can qualify for tax credits.
Form 8863: By filing Form 8863 to know if you are qualified for the Lifetime Learning Credit or The American Opportunity Credit.
Form 1098-E: You may receive Form 1098-E on paying interest on student loans. In addition, if a lender gets the interest of at least $600 on your loan then they need to send you the 1098-E form stating the amount you paid as interest. In case you are having more than one loan then you also need to file this Form 1098-E separately (for each loan).
Note: If you are filing the tax that goes up to $2500 annually then you are capable of deducting the interest that is specified in the form 1098-E.
Form 1099-INT: You can receive this form when you get $10 in your interest payments throughout the year. It specifies the banks that pay you an amount of interest on the savings accounts. Moreover, you need to include this interest on your form when filing taxes.
Tip: If you are filing a tax return for the first time (as a student), it is suggested to ask for assistance from tax professionals. Because by filing the tax return, you can save money but you may receive a complicated tax return if you submit multiple W-2 forms, education credits, or income from side jobs.
In addition, it is important to prepare for a tax return, round up the W-2 form, and get documents together. This may make your process stress-free.
For a better experience, one can use the trusted tax filing software programs such as TurboTax. Such tools allow you to capture a picture of the Form W-2 to initiate the process.
When Can You File a Tax Return with No Income?
You must be wondering when can you file taxes with no income. Taxes can be filed till 15 April every year. In case the due date falls on the weekend then the date can be adjusted 1-2 days later. It is also suggested to file your taxes at the earliest as you may get the refund faster.
Every taxpayer in the United States should file a tax return every year regardless of the income. Relying on tax professionals can benefit in certain ways. For instance, professionals can help you file the zero income tax return while preventing you from suspicions. Moreover, they help you to collect refunds and deal with the audit effortlessly.
And, if you are a college student, you can also file an income tax return taking care of the tax rules set by the IRS.
If you have organized your business as Limited Liability Protection but have no income then learn here how to file taxes for LLC with no income.
Frequently Asked Questions (FAQs)
Ans. Yes. You can file taxes even if you do not make any income during the tax year. The IRS says if you are registered as a taxpayer it is necessary to file taxes every year.
Ans. To file taxes without having an income, you are required to file the zero income return. All you need to use Zero as your income when filing the income tax. Also, make sure that you don’t abuse the deductions such as charitable donations, home repairs, or legal expenses.
Ans. If your college makes it necessary to file tax returns then you should file the tax return following the tax rules.