What is the minimum income to file taxes as a dependent?

Individuals whose salaries exceed specific thresholds must file tax returns, but money isn't the sole consideration. Various factors can influence the need because the requirements are based on your filing status and other characteristics. There are additional times when you might desire to file a return even though you aren't compelled to. Many of the benefits outlined in the American Rescue Plan Act (ARPA), which was signed into law in March 2021, necessitate filing a tax return. For the 2021 tax year, the eligibility criteria were temporarily lowered. The ARPA temporarily repealed the $2,500 minimum income requirement for receiving the Child Tax Credit and temporarily increased the credit to $3,600 for children under six. These improvements are only in effect for the 2021 tax year, but you don't have to wait until 2022 to take advantage of them. Beginning in July 2021, many families will get half their Child Tax Credit in monthly installments. They can claim the remaining half in 2022 when they file their 2021 tax returns. 2

Income Thresholds for Taxes: What Influences Them

In general, four elements decide whether you must file a tax return, and each condition may impact your gross income threshold. The four elements are as follows:

Whether or not you are claimed as a dependency by someone else
Your age, whether you're married or single
Whether you're deafening
Some of these factors may interact, causing the income criteria for required filing to vary.

Taxes Minimum Gross Income Thresholds

The criteria start with your gross income, which is whatever you get in the form of money that isn't tax-free. Money, services, property, and goods can all be included in gross income. 4 The following thresholds applied to income received in 2021 and reported on your 2021 tax return 2022. Because you would deduct this amount from your gross income and pay tax on the difference, they're equal to the year's standard deduction. If you're single and earn up to $12,550 in 2021, you'll owe no tax and won't have to file a 2021 tax return because that's the standard deduction amount. If you deduct it, your taxable income will be $0. However, if you earned $12,551, you'd have to submit a tax return since you'd have to pay income tax on that extra dollar. The following is the minimum gross income requirement for the 2021 tax year:

$12,550 for a single person under the age of 65.
$14,250 for a single person over the age of 65.
If both spouses are under 65 and filing jointly, the total tax is $25,100.
$26,450 if married filing jointly and one spouse is 65 or older.
$27,800 if married filing jointly and both spouses are 65 or older.
At any age, married couples must file separately: $5
$18,800 if the head of the household is under the age of 65.
$20,500 if the head of the household is 65 or older.
$25,100 for a qualifying widow(er) under age 65.
$26,4505 for a qualifying widower over the age of 65.
On the IRS's website, you can use a tool to see if you need to file a tax return based on your circumstances. It will take you about 12 minutes to finish.

Standard Deductions Qualifying Rules

Several rules and requirements determine your filing status. Head of the Family To file as head of household, you must be unmarried on the last day of the tax year, pay more than half of the expense of keeping your home for the year, and have a qualifying dependent. Widow or Widower is a term used to describe a woman who has lost For the two years following the spouse's death, a qualifying widow(er) with a qualifying child dependent is entitled to the same standard deduction as married taxpayers filing jointly. Other rules apply as well. Over the age of 65 or blind Single taxpayers aged 65 and more, as well as blind people, are entitled to an additional $1,700 standard deduction in addition to the ordinary standard deduction. Because of the additional funds, their filing requirements differ. If both spouses are over 65 or blind, they can add $2,700 or $1,350 if only one spouse is over 65 or blind. If you file as head of household, you get an extra $1,700, and qualifying widow(er)s earn $1,350 in these circumstances. The standard deduction must be claimed by married taxpayers filing separate tax returns. One of them will not be able to itemize their deductions. You must meet specific criteria if you can be claimed as a dependent. If you're single, someone else can claim you as a dependent, and you're not 65 or older or blind, you must submit a tax return for 2021 under any of the following circumstances:

You made more than $1,100 in unearned income.
Your taxable income exceeded $12,550.
Your gross income exceeded $1,100 or $350, whichever is more extensive, plus your earned income up to $12,550.
Taxable scholarships and fellowship grants must be included in the income of dependents who are students.

Situations in which Taxes are Filed in an Unusual Way

Even if you don't meet these income levels, you must file a tax return if you owe any special taxes. The additional tax on a qualified retirement plan, such as an IRA or other tax-favored account, is one of these special taxes. You can, however, submit IRS Form 5329 by itself if you need to file a return because you owe a specific tax. The Alternative Minimum Tax and Social Security and Medicare taxes on gratuities you didn't declare to your employer are all special taxes. You must file if you earned at least $400 from self-employment or $108.28 or more from a church or qualified church-controlled organization exempting employer Social Security and Medicare taxes. If you, your spouse, or a dependent were enrolled in a Marketplace plan and received premium-tax-credit payments, you must file a return. You'll know if this applies since a Form 1095-A documenting the payments will be sent to you. Taxpayers have their own set of rules. 65 years and older The filing thresholds for taxpayers 65 and older are different and more generous. If you were born on January 1, 1957, you would be considered 65 for tax reasons. If your income for the tax year was $5 or more and you were married but didn't file a joint return, the age-65 rule does not apply to you. Social Security payouts aren't counted as income for most people. They will, however, if:

You were married to your spouse during the tax year and are filing a married-filing-separate return.
Suppose your Social Security payments, additional gross income, and tax-exempt interest total more than $25,000 ($32,000 if married and filing jointly). In that case, you must file a joint return.

Why Should You File a Tax Return in the First Place

If your income is below the required minimum, you may choose to submit a return if it will result in a tax refund. This would be if any taxes were deducted from your income, such as withholding on wages or payouts from a retirement plan, and you overpaid your taxes because your income fell below certain filing levels. There would be no tax due, and you would be entitled to a refund of the money withheld. Suppose you're eligible for one or more refundable tax credits, such as the Earned Income Credit. You'd need to file a tax return to compute and claim the credit and obtain a refund from the IRS. In that case, filing could result in a tax refund. If you have been or suspect you have been a victim of identity theft, you should file a tax return. Filing a return notifies the IRS of your genuine income for the year. It prohibits a thief from using your name and Social Security number to file a phony tax return. 15

Most Commonly Asked Questions (FAQs)

When do you have to pay your income taxes Tax Day is generally April 15, but the deadline is pushed back if that day comes on a holiday or weekend. When do you have to quit submitting income taxes You must continue to file income tax returns as long as you make enough money to meet the minimum filing requirements. Your income is still the essential criterion in determining your threshold. What is the typical tax percentage of a person's income Because so many aspects go into establishing filing status and numerous techniques of computing taxes, it's impossible to define an "average" U.S. taxpayer. However, in 2020, the last year for which comprehensive statistics are available, the average tax rate after benefits for a single worker was 22.4 percent, according to the Organization for Economic Cooperation and Development. For the average married worker with two children, this figure fell to 7%.