If you earn more than the amount specified by the government as tax-free, you must file a tax return. There are some circumstances where you might have to file a return even if you earn less than that amount, and we can help you figure out if that’s the case for you. So it’s not too late if you haven’t filed a return yet.
If you haven’t filed your taxes in a few years, getting up to date is essential. The IRS can apply sanctions and penalties if you don’t file, so it’s best to just file your taxes on time to avoid penalties.
What If I Don’t Need to Lodge a Tax Return?
If your annual income does not exceed certain thresholds, you are not required to file a federal tax return. This is considering that you file a non-lodgement advice to the ATO stating the reason you’re not required to lodge a tax return. Without the advice, you may face penalties for non-filing.
Consider Your Gross Income Thresholds
If you’re eligible to take the standard deduction, you can choose to claim it on your tax return. The standard deduction allows you to reduce your taxable income by a set amount, depending on your filing status. This can lower your tax bill and simplify your tax return.
The standard deduction is a fixed dollar amount that reduces the amount of income that is taxable. This deduction, along with other available deductions, can lower the amount of taxes you owe.
You generally don’t need to file a return if your income is below the standard deduction. However, if you have income from sources such as self-employment, you may need to file a return even if your income is below the standard deduction.
What Are the Common Tax Deductions?
There are many deductions that people don’t know about. Here are some of the more common ones:
- State and local taxes: You can deduct state and local income taxes and property taxes on your federal tax return.
- Mortgage interest: You can lower your taxable income by the amount of your mortgage interest.
- Charitable donations: You can deduct charitable donations of money or property.
- Medical expenses: You can deduct expenses exceeding 7.5% of your adjusted gross income.
- Student loan interest: You can deduct up to $2,500 of student loan interest per year.
What Happens If You Don’t File a Tax Return in the US?
There can be severe consequences if you don’t file a tax return in the US. You may be subject to fines, and you may not be able to receive some government benefits.
Additionally, the IRS may take legal action against you to collect the money you owe. It is important to file your tax return on time every year. And if you’re qualified to not file a tax return, it’s best to consult a tax professional to confirm.
In conclusion, not lodging a tax return can have serious consequences, including fines, interest charges, and even imprisonment in some cases. Therefore, it is important to lodge your tax return on time each year and seek assistance if you are unsure about how to do so.
Do you need the help of a tax resolution specialist? Axiom Tax Resolution Group can help you find a permanent solution to your tax problems with the IRS. Get in touch with us.