How Much Money Can You Make and Not Pay Taxes?
Making money and not paying taxes sounds like a dream for most people. However, for some Americans this is reality. Several factors determine whether you need to pay taxes or not. Your age, filing status, dependents, gross income, or if you are blind are the factors that weigh in. For example, in 2018, if you were a single person under the age of 65 years and did not earn more than $12,000, you did not have to pay any federal taxes.
The U.S has a progressive income tax system which means that the more money you make, the more tax you pay. This can differ every year if your income changes as well. The IRS has published minimum income amounts that need to be exceeded for groups of people to file taxes. For example. If you are single, under the age of 65, and earn more than $10,400 you will need to pay income tax. Again, the amounts differ per situation. So, in case you are not single, different income thresholds apply.
When determining the thresholds for American citizens to pay income tax, the IRS always looks at the gross income earned in a year. All information regarding the progressive income tax system is published by the IRS in Publication 17 and Publication 501.
If you are a dependent, you are subject to different rules to file and pay taxes. The IRS considers you as a dependent if you are under the age of 19 or 24 if you can prove that you are a student. You are also a dependent in case you are permanently disabled along with members of the household who are taking care of you all year-round.
Lastly, the factor that determines whether you are eligible for an exemption or standard deduction is whether you are blind or not. Different rules apply to blind people as well. Contact us for more information.