Tax Filing Services & Exemptions - Who Needs to File Their Taxes?

Anyone earning income needs to file a tax return

This is the easiest category of taxpayers to quantify. After all, it’s called an income tax return for a reason! With very few exceptions, anyone who holds down a job has some money withheld from each paycheck to pay into federal taxes, social security taxes, Medicare, and state income taxes (where applicable). This includes anyone who is a full-time employee, part-time employee, or a seasonal worker. If you are self-employed or a freelancer, you may or may not see any variety of tax withholding on your paycheck, but that depends on how your pay is set up. The long and short of it is, if you’re earning an income, the federal government is going to expect their cut and, generally, it’s easier to take a bit out of your paycheck before it even hits your bank account than it is to pay one large lump sum once a year. In addition to anyone in the workforce, there are a few more subsets of people required to pay taxes that you may not immediately assume; these include:

Those working in the United States who don’t have a Social Security number

That’s right, the lack of a social security number does not exempt you from paying federal income taxes. If you are working for an employer in the United States, the U.S. government expects you to pay taxes, whether you are a citizen, resident alien, or even some non-resident aliens. Generally speaking, if you earn money in the U.S., you will likely need to pay taxes on that income. If you do not have a Social Security number, you will need an Individual Taxpayer Identification Number in order to file your tax return. Be sure you don’t forget to keep your I.T.I.N. current, as well as those for your immediate family members, as that number will allow you to provide eligibility for Social Security benefits and qualify dependents for tax credits.

Retirees

You may be wondering, if you are beyond the age where you are part of the workforce and not earning an income any longer, why do you still need to file taxes? Just because you aren’t actively an employee doesn’t legally mean you’re no longer earning income. Some retirement savings plans, pensions, and annuities can still count as income, though it may not be the traditional income you’re thinking of. Even Social Security disbursements count as taxable income! The general guideline is, if you had money taken out of your pay before taxes could be applied to them, you’ll be responsible for paying taxes on those funds when you begin pulling savings out of your accounts.

Tax Filing Exemptions

As you are probably coming to understand, the vast majority of adults (and working teens) are responsible for filing a tax return. The few exceptions to this rule are those who earn less than the standard deduction plus one exemption or you are the dependent of another taxpayer—in which case your tax information will be filed under your parent’s or guardian’s tax return. If you’re unsure whether you are exempt from filing, the IRS website has a handy interactive tool to determine if you should file or not.