Do I Have to File Taxes If I Made Less Than $600?

General Filing Requirements

The Internal Revenue Service (IRS) mandates tax filing based on several factors, including an individual’s gross income, filing status, and age. Gross income encompasses all earnings from various sources, such as wages, salaries, interest, dividends, and capital gains, unless specifically excluded by tax law.

A primary determinant for filing is whether an individual’s gross income exceeds a certain threshold, which is typically linked to the standard deduction amount for their filing status. For the 2024 tax year, a single filer under 65 generally needs to file if their gross income is at least $14,600. For married couples filing jointly, where both spouses are under 65, the threshold is $29,200. An individual filing as Head of Household, under 65, would have a filing requirement if their gross income reaches $21,900.

Age also influences these thresholds, with higher amounts for individuals aged 65 or older. For example, a single filer aged 65 or older must file if their gross income is $16,550 or more for 2024. Similarly, for married couples filing jointly, if one spouse is 65 or older, the threshold increases to $30,750, and if both are 65 or older, it rises to $32,300.

Being claimed as a dependent on another taxpayer’s return significantly alters one’s own filing requirement, often lowering the income thresholds. For a dependent, the standard deduction amount cannot exceed the greater of $1,300 or the sum of $450 and their earned income. If a dependent’s gross income exceeds these specific lower amounts, they would generally be required to file a tax return.

Specific Income Scenarios and the $600 Question

The common perception that individuals do not need to file taxes if they earn less than $600 often stems from payer reporting requirements, not individual tax obligations. Businesses and clients frequently issue Forms 1099-NEC (for non-employee compensation) or 1099-MISC (for rents, royalties, etc.) when payments to an individual exceed $600 in a calendar year. This reporting threshold for the payer does not, however, dictate whether the recipient must file a tax return. All income, regardless of whether a 1099 form is issued, is generally considered taxable and must be reported if an individual’s overall filing requirements are met.

A specific and much lower filing threshold applies to self-employment income, which includes earnings from independent contractor work, freelance activities, or operating a small business. Individuals must file a federal income tax return if their net earnings from self-employment are $400 or more. This requirement is in place because self-employment income is subject to self-employment tax, which covers Social Security and Medicare contributions.

Beyond the general gross income and self-employment thresholds, certain other situations can trigger a filing requirement. For instance, individuals who received advance payments of the Premium Tax Credit (APTC) to help cover health insurance costs through the Health Insurance Marketplace must file a tax return. This filing is necessary to reconcile the advance payments received with the actual Premium Tax Credit amount they qualify for based on their final income and family size for the year. Similarly, having specific types of unearned income, such as certain distributions from a health savings account, can also create a filing obligation even if overall income is low.

Reasons to File Even if Not Required

Even if an individual’s income falls below the mandatory filing threshold, filing a tax return can often be financially beneficial. One primary reason to file is to claim a refund of any federal income tax that was withheld from wages. If an employer withheld taxes from paychecks, filing a return is the only way to receive any overpaid amounts back.

Filing also allows individuals to claim refundable tax credits, which can result in a tax refund even if no tax was owed or withheld. The Earned Income Tax Credit (EITC) is a significant refundable credit designed for low-to-moderate-income workers and families. For 2024, the maximum EITC ranges from $632 for individuals without children to $7,830 for those with three or more qualifying children, depending on income and filing status. Eligibility for the EITC generally requires having earned income, with specific income limits that vary by family size.

The Child Tax Credit (CTC) and Additional Child Tax Credit (ACTC) also offer substantial benefits to eligible families. The CTC can be worth up to $2,000 per qualifying child for the 2024 tax year, and a portion of this, up to $1,700 per child, is refundable through the ACTC. This means families could receive a refund even if they do not owe federal income tax. Additionally, the American Opportunity Tax Credit (AOTC) provides a credit for qualified education expenses, with up to $1,000 of the credit being refundable. The AOTC can be as much as $2,500 per eligible student and is available for the first four years of post-secondary education.

Beyond direct refunds, filing a return to report self-employment income, even if below the income tax filing threshold, is crucial for establishing Social Security credits. These credits determine eligibility for future Social Security and Medicare benefits, including retirement, disability, and survivor benefits. For 2024, one Social Security credit is earned for each $1,730 in earnings, up to a maximum of four credits per year. Most individuals need 40 credits, equating to approximately 10 years of work, to qualify for retirement benefits.