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How do I do taxes when I haven't worked all year?
April 6, 2009 1:41 PM   Subscribe

How do I do taxes when I haven't worked all year? Let me explain: I spent all of 2007 saving money so I could spend the first half of 2008 teaching myself a new career path I'm interested in. I had originally intended on picking up a job halfway into the year, but as it turns out I was able to spend the whole year learning. I'm not enrolled in any school, so I'm not technically a student or anything. I also didn't make any money in 2008, I just lived very frugally. So how do I approach taxes?
posted by OccamsRazor to Work & Money (10 answers total) 2 users marked this as a favorite
 
Perhaps I'm missing an aspect of your question, but in all the places I know of, there's a minimum income threshold you have to hit before you pay income tax.

So in Ontario for instance if you make less than seven grand or so in a year (though it's been a while since I checked) you don't pay any income tax.

So, chill, ignore your taxes =)
posted by geodave at 1:45 PM on April 6, 2009


If you had no income in 2008, you do not owe taxes. Regardless, you should read this and see if it applies to you.
posted by wocka wocka wocka at 1:47 PM on April 6, 2009


Might want to file for the 1099-INT forms you got, but of course the first $8000 or so of income isn't taxed so you're cool. It might be a generally good idea to file anyway though, just to let your friends in the IRS know you're still alive.
posted by mrt at 1:48 PM on April 6, 2009


If you didn't make any money, then you shouldn't owe any taxes. If your income is under a certain amount, you are not required to file a tax return. (Don't forget that a lot of things can be considered income...eg if your parents gave you money, or if you made any interest on your savings account). However you should probably do it anyway, it's free, and should take you just a few minutes. (this answer assumes you live in the USA). There's tons of pages that explain if you have to file or not: [1] [2] [3].

It may actually be to your advantage to file, in case you qualify for any credits, you may actually get a refund. At the very least you should complete the return to see what the results are, then decide if you will file it or not.
posted by davr at 1:49 PM on April 6, 2009


Thanks for the link Wocka, I'll check it out. I've always had a 9 to 5, so not filing taxes is something quite new to me.
posted by OccamsRazor at 1:57 PM on April 6, 2009


I would go ahead and file. While it's normal for college age kids to not file, it's a bit odder for a typical 9 to 5 to go off the grid.

While you're certainly in your rights to not file, the IRS is also in their rights to audit you to make sure that you're in your rights to not file. Avoid as many red flags as possible. Perhaps include a cover letter that explains the discrepency. It will probably be tossed aside and not looked at again, but it can't hurt.
posted by politikitty at 2:08 PM on April 6, 2009


>if your parents gave you money

No. Not by any means. Gifts are non-taxable to the recipient. And if the amount is under $13,000 per year, there are no gift tax concerns to the donor either.
posted by yclipse at 2:10 PM on April 6, 2009


There may be some tax credit that could make it worthwhile to file. Keep records of any income. An audit isn't fun, but in this case, would be painless.

There's a significant savings tax credit for low income people, and maybe others. Well worth checking out.
posted by theora55 at 4:00 PM on April 6, 2009


IIRC, the last stimulus required that you had filed taxes. (Someone I know on disability filed for the first time in years.) So there's that.
posted by epersonae at 5:27 PM on April 6, 2009


Also, filing will start the audit clock.
posted by Fuzzy Dog at 11:51 PM on April 6, 2009


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