To File or not to File: That is the question

This year (2007) it is expected that approximately 135 million taxpayers will file a tax return: some early, some late and some, due to procrastination or other reasons, will ask for extension. However, there are those taxpayers that are not required to file tax returns.

Taxpayers are required to file tax returns only if their income is above a marked level, although the amount is dependent on the taxpayer age, source of income and filing status. Point in fact: a married couple under age 65 whose joint income is less than $16,900 is not required to file taxes.

Conversely, Individual taxpayers whose income exceeds $400 are required to file taxes. In the case of the individual having a little side job (for instance, a lawn mowing job) the individual should fill a Schedule C.

Taxpayers are advised to check the instructions from IRS form 1040, 1040A, 1040EZ and other forms for detail that may clear doubts about their filing status.

Although you may not be required to file, it may be sensible for you to still file, so that you can get money if Federal Income Tax was withheld from your income or if you are eligible for a return from one or more of the government tax deductible provisions.

Here are some of the tax provisions that provide tax incentives and, thus, make it imperative for taxpayers that are not required to file a tax return to do so:

Earned Income Tax Credit The Earned Income Tax Credit is a federal income tax credit for qualified low-income workers. The credit reduces the amount of tax an individual owes, and is returned to the taxpayer in the form of an income tax refund.

Telephone Tax Refund For one time only, the IRS is giving a tax return for long-distance excise taxes that the government believes should not have been collected. Qualified taxpayers are those who paid long-distance taxes on land- line, cell phone or Voice over Internet Protocol (VOIP)

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