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5 IRS Tips on Whether You Should File This Tax Season

By Dan Caplinger - Jan 17, 2020 at 7:05AM

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Find out whether the government thinks you need to prepare a 2019 tax return.

Tax season is just about to start, and the vast majority of Americans will have to prepare and file a tax return for the 2019 tax year. The IRS is getting ready for an onslaught of tax return filings, but it also wants to give good information to taxpayers to decide whether they really need to file.

The key thing to remember is that even though you might not have to file, there are still situations in which you'll want to file. With that in mind, the IRS recently provided five tips designed to help you decide whether you should prepare a tax return this tax season.

Brick wall with Internal Revenue Service plaque on it.

Image source: Getty Images.

1. Understand the rules for when you have to file

In order to figure out whether you're required to file a return, the most important pieces of information are your age, your filing status, and how much income you have. In general, if your total income is less than the standard deduction amount that applies to people of your age and filing status, then you won't need to file. However, there are several exceptions, including for taxpayers who are self-employed or who qualify to be claimed as someone else's dependent.

In order to help better predict if you need to file, the IRS has developed an app called the interactive tax assistant. If you provide some basic information, the IRS will tell you whether you're required to file.

2. Look at taxes that you've paid or had withheld from your paychecks

Even if you aren't required to file a return, you might be leaving money on the table if you don't. For instance, if you made estimated tax payments during the year or had an overpayment from last year's return applied to the current tax year, then your only way to get that money back might be to file a return. Similarly, those who've had money withheld from their paychecks in 2019 will typically have to file a 2019 return in order to have it refunded to them.

3. Check to see if you can claim the earned income tax credit

Tax credits are valuable because they can reduce your outstanding tax owed. But a few tax credits go further, letting you claim a refund even if you don't otherwise owe any tax. The earned income credit is one such refundable credit, with the credit amount based on your filing status and how many qualifying children you have. With credits as high as $519 for those with no children, $3,461 for those with one child, $5,716 for those with two children, and $6,431 for those with three or more children, it's worth taking a look at the earned income tax credit to see if filing could put thousands of dollars back into your pocket. Again, the IRS provides an EITC assistant app to help you determine your own eligibility.

4. Determine your eligibility for credits for children or dependents

Taxpayers with qualifying children 16 or younger who meet certain requirements can claim credits of up to $2,000 per child, and up to $1,400 per child can be a refundable credit for those who don't owe any tax. Filing is a requirement to collect that refundable credit.

Moreover, you might be able to get a smaller credit of up to $500 for dependents who aren't qualified children. That can include kids 17 or older, as well as parents or other qualifying individuals for whom you provide financial support. However, this credit isn't refundable. Check out the IRS child tax benefits tool for more information.

5. Claim education credits if you can

Two education credits are available to some taxpayers: the American Opportunity tax credit for undergraduate education and the Lifetime Learning tax credit for all other students. The American Opportunity credit can give you up to $2,500 per year, and $1,000 of that can be refundable even if you don't owe tax. The Lifetime Learning credit, on the other hand, can give you up to $2,000 per year, but it's not refundable. Learn more about these credits here.

File if you have to -- or if it's worth it

Given the choice, many people wouldn't bother filing a tax return. But even if you're fortunate enough to qualify not to file this tax season, it's still worth looking to see if you could score a big refund by doing a little work. By following these five steps, you'll know the right answer for your situation.

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