Learn when you can forget filing a return with the IRS

Tax Tips

Your Money

April 04, 2004|By Lorene Yue

If you were 65 or older on Jan. 1, 2004, you may not have to file a tax return as long as you don't trip the income trigger.

According to the Internal Revenue Service, you must file a return if your filing status is:

Single and you have non-Social Security income of more than $8,950.

Head of household and your non-Social Security income is more than $11,200.

Married, filing jointly and either you or your spouse is 65 or older and you have non-Social Security income of more than $16,550.

Married, filing jointly and both you and your spouse are 65 or older and have a combined non-Social Security income of at least $17,500.

Even if your income is below these limits, if you had taxes withheld from your income, you should file to get a refund of taxes that were withheld.

If you are 65 or older and have to file a return, you'll get to claim a higher standard deduction. If you are a single filer, it's $5,900. If you are over 65, married, filing a joint return and your spouse is not 65, then the standard deduction is $10,450. If you and your spouse are 65 or older, married and filing a joint return, and you are claiming your spouse's exemption, then the standard deduction is $11,400.

Something else seniors will want to keep in mind when figuring out tax returns is to count qualified home nursing care and long-term care insurance premiums as medical expenses. To deduct medical expenses, the amount spent has to be more than 7.5 percent of your adjusted gross income.

Tax experts said if you are elderly and live with a child who is paying for more than half of your living expenses, you may want to see if your child's tax burden is lowered by claiming you as a dependent.

Children may be able to claim their parents as dependents even if they do not live in the same home, as long as the child is paying more than half of the parent's total support for the year.

The parent would still have to meet the other dependency tests for gross income and residency and not file a joint return with someone else.

Next week: How to get an extension.

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