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t-n2020
New Member

Does small cash income need to be claimed? I'm retired.

Being retired how much cash income needs to be claimed?
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2 Replies
MinhT1
Expert Alumni

Does small cash income need to be claimed? I'm retired.

It depends.

 

If the amount received in cash (without a form W-2 or 1099-NEC), and you have no other income, then you are not required to report it if it is $400 or less.

 

If the amount is above $400, you have to report it as it is self-employed income. You do not have to pay income tax if total income is below the standard deduction ($12950 if single plus $1,750 if you are over 65). But you have to pay self-employment tax for income over $400.

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Does small cash income need to be claimed? I'm retired.

You can use the IRS tool here.

https://www.irs.gov/help/ita/do-i-need-to-file-a-tax-return

 

If by "cash income" you mean self-employment income, you must file if your net self-employment income after expenses is more than $400, because you must pay self-employment tax (the self-employed version of social security and medicare withholding for W-2 employees) even if your income is too low to pay income tax.

 

If your income is from pensions, gambling, hobbies, or a small W-2 job, then the filing threshold depends on your age and filing status (married, single, etc.) and the IRS tool is the best way to figure it out.  In general, a single retired person would not have to file a return if their non-social security income was less than $14,350, as long as that did not include self-employment.  

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