If social security is my only source of income do I need to file a state and federal return? Thanks.

[pk]

what is the income you have from Social Security?  Are you married and if so does your spouse also receive Sosial Security? Do you have any other income -- no matter what size? Do you have out-of-pocket medical, mortgage, property tax expenses?  There are a lot of details we need before one can say for sure. My general suggestion would be to file anyways. Please answer the questions

[CherylW · Accepted solution]

If the only income you had was Social Security, then you do not have to file a 1040.   

This, from the Instructions for Form 1040:  

Do not include any social security benefits unless (a) you are married filing a separate return and you lived with your spouse at any time in 2016 or (b) one-half of your social security benefits plus your other gross income and any tax-exempt interest is more than $25,000 ($32,000 if married filing jointly).  

[ots0108]

I prepare my parents taxes and although they have mortgage interest, property taxes, donations and medical expenses, they didn't have any taxes deducted and TurboTax is showing they can't file a 1040.  Do they even need to file at all?

[DoninGA]

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@ots0108 wrote:

I prepare my parents taxes and although they have mortgage interest, property taxes, donations and medical expenses, they didn't have any taxes deducted and TurboTax is showing they can't file a 1040.  Do they even need to file at all?

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If the Social Security benefits are the Only income to be reported on the tax return, then there is no reason or need to file a tax return.

[ots0108]

Correct, they only have social security benefits and no other income to report.  So, what happens if my mom gets a side job in 2020 and earns income... there would be a potential gap in tax reporting... will that be a problem?  

[DoninGA]

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@ots0108 wrote:

Correct, they only have social security benefits and no other income to report.  So, what happens if my mom gets a side job in 2020 and earns income... there would be a potential gap in tax reporting... will that be a problem?  

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No, there is no issue if she works in 2020.  The income would be reported on their 2020 tax return and the SS benefits received in 2020 would also be reported on the 2020 return.  If she has reached full retirement age then there is no reduction in her benefits, she can earn as much as she wants.

See this SS website for information - https://www.ssa.gov/planners/retire/whileworking.html

Based on the amount of earnings, some of the SS benefits can become taxable -

Up to 85% of Social Security Retirement/Disability/Survivors benefits becomes taxable when all your other income plus 1/2 your social security reaches:

• Married Filing Jointly - $32,000
• Single or Head of Household - $25,000
• Married Filing Separately - 0