Advantages to filing when earned less than $12950?

[KP3535]

Are there any advantages to filing if I’m not required to? I will earned less than $12,950 in 2023

[xmasbaby0]

If you had tax withheld and have amounts in boxes 2 or 17 of a W-2 the advantage of filing a tax return is that you can get a refund.   If the amount you earned was even more than $400 and you worked as an independent contractor, then you are required to file and pay self-employment tax for Social Security and Medicare.

[JandKit]

Hi KP3535

In addition to answers that you may have received, You could still possibly qualify for the Earned Income Tax Credit. This credit is for those who have income in a specific range and you certainly do, based on your question.

Goodluck to you and this is an opportunity to increase your refund!

[KP3535]

Is a refund and an earned income tax credit still possible if I am married filing separately?

[xmasbaby0]

You are not eligible for the earned income credit if you file married filing separately.  You can, however, still get a refund of federal and/or state tax withheld from boxes 2 and 17 of your W-2.

If you are thinking about filing separate returns, there are other important things you  need to be aware of.

If you were legally married at the end of 2023  your filing choices are married filing jointly or married filing separately.

Married Filing Jointly is usually better, even if one spouse had little or no income. When you file a joint return, you and your spouse will get the married filing jointly standard deduction of $27.70000 (+$1500 for each spouse 65 or older)  You are eligible for more credits including education credits, earned income credit, child and dependent care credit, and a larger income limit to receive the child tax credit. 

If you choose to file married filing separately, both spouses have to file the same way—either you both itemize or you both use standard deduction. Your tax rate will be higher than on a joint return. Some of the special rules for filing separately include: you cannot get earned income credit, education credits, adoption credits, or deductions for student loan interest. A higher percent of your Social Security benefits may be taxable. Your limit for SALT (state and local taxes and sales tax) will be only $5000 per spouse. In many cases you will not be able to take the child and dependent care credit. The amount you can contribute to a retirement account will be affected. If you live in a community property state, you will be required to provide additional information regarding your spouse’s income. ( Community property states:  AZ, CA, ID, LA, NV, NM, TX, WA, WI)

 If  you are using online TurboTax to prepare your returns, you will need to prepare two separate returns and pay twice.

https://ttlc.intuit.com/questions/1894449-married-filing-jointly-vs-married-filing-separately

https://ttlc.intuit.com/questions/1901162-married-filing-separately-in-community-property-states

https://ttlc.intuit.com/questions/1894449-is-it-better-for-a-married-couple-to-file-jointly-or-separ...