No, as employee, you do not have to
earn a minimum income for federal and state income tax to be withheld.
Federal
income tax is based on the employee’s filing status, number of
allowances/exemptions, earnings, and the IRS withholding tax tables. All these
factors determine the employee’s federal income tax withholding amount. The
employee can earn a small amount of income but because he has few exemptions,
he owes federal income tax. He can earn a large income but has so many
exemptions that he pays no federal income tax. In the latter case, unless the
employee truly is allowed to claim that many exemptions, he can end up owing
the IRS. If the employee qualifies for exempt status, then no federal income
tax should be withheld. State income tax withholding is dependent on similar factors.
Furthermore, FICA taxes are based on a set percentage, which must be withheld,
regardless of income amount.
If your income is equal to or less than the sum of
the exemption and standard deduction, the IRS doesn't require
you to file a return. When
determining whether you need to file a return, you don't include tax-exempt
income. In 2017 for example, if you are under age 65 and single, you must file
a tax return if you earn $10,400 or more, which is the sum of the 2017 standard
deduction for a single taxpayer plus one exemption.
