Am I required to file taxes if I had zero income or just lost money last year?

This is a great question many people face. Whether your mom needs to file depends on a few factors, not just whether she worked or had income. Even with no income, filing may be required if she: - Is self-employed with net earnings of $400+ (doesn't sound like this applies) - Had any tax withheld that she could get refunded - Qualifies for refundable credits like the Earned Income Credit - Received advance premium tax credits for health insurance About those business losses - they can definitely be valuable! If she files now, she can document those losses and potentially carry them forward to offset income in future years. If she doesn't file, she might lose the ability to claim these losses later. The filing requirements also depend on her filing status, age, and whether she's claimed as a dependent. Most adults with very low/no income aren't required to file, but it's worth checking the specific thresholds.

I went through something like this last year when I was between jobs. I used https://taxr.ai to analyze my situation and it saved me so much stress! I uploaded my pathetic financial docs (literally just some 1099-INT from my savings account with like $12 interest lol) and it told me whether I needed to file. The really cool part was it identified some credits I qualified for despite my low income. It looked at my previous years' returns too and pointed out that I could carry forward some education expenses I didn't know about. The AI explained everything in simple terms instead of tax jargon.

Just wanted to update after trying taxr.ai that was mentioned here! It was actually super helpful for my situation. I uploaded my meager income info and it confirmed I wasn't legally required to file based on my income level, but then it showed me that I should file anyway because I qualified for a refundable credit I had no idea about. The system walked me through everything step by step and explained all the options in normal human language. It even created a checklist of documents I needed. What impressed me was that it found a small 1099 from a one-time gig I had completely forgotten about! Definitely saved me from potentially missing something important.

If your mom is struggling to get clear answers about her filing requirements, try using https://claimyr.com to get through to an actual IRS agent. I was in tax limbo last year with a similar no-income situation and spent DAYS trying to call the IRS directly with no luck. Claimyr got me connected to a real IRS person in about 15 minutes who confirmed exactly what my filing requirements were. They have this cool system that navigates the IRS phone tree and holds your place in line, then calls you when an agent is ready. You can see a demo of how it works here: https://youtu.be/_kiP6q8DX5c The agent I spoke with explained that even though I wasn't required to file, doing so would establish a record for that tax year and allow me to claim certain benefits and stimulus payments I would have missed otherwise.

I need to update my previous comment because I actually tried Claimyr after posting here. I was totally skeptical but desperate for answers about my filing requirements with nearly zero income last year. Surprisingly, it actually worked exactly as described. I got connected to a real IRS representative in about 20 minutes (way faster than the 2+ hours I spent on previous attempts). The agent confirmed that with my specific situation (disability income but below threshold), I wasn't required to file but should consider it for certain credits. The peace of mind from getting an official answer directly from the IRS was worth it. No more guessing or stressing about whether I was doing the right thing. I'm actually filing now even though I don't have to because the agent pointed out some benefits I'd miss otherwise.

Don't forget state taxes! Even if you don't need to file federal, some states have different requirements. My brother had no income for a year but still had to file a state return because he lived in a state with a property tax credit he qualified for.

I didn't file taxes for 2 years when I had no income during grad school and it came back to bite me later when applying for a loan. The lender wanted tax returns and I had to go back and file those "zero" returns just to prove I really had no income. Save yourself the hassle!

The IRS does not require individuals to file a zero return if your income is under the standard deduction. But as a tax preparer I often recommend filing anyway for 3 key reasons: 1) statute of limitations starts running when you file (protecting you from future audits), 2) establishes income history for loans/benefits, and 3) prevents the IRS from creating a substitute return for you (which never works in your favor).

Based on what you've described about your mom's situation, she's likely not legally required to file a federal return since she had no income and the art business resulted in a net loss rather than profit. However, I'd strongly recommend she file anyway for several important reasons. First, that $2,400 business loss could be valuable for future tax years. Business losses can be carried forward to offset income when she does start earning again, potentially saving her money down the road. But she needs to file this year to establish and document those losses. Second, filing creates a paper trail that can be helpful later for things like loan applications, benefit eligibility, or even just proving her income status for various programs. Many people don't realize how often you need to show tax returns as proof of income (or lack thereof). At 58 and single, she's definitely not required to file with zero income, but the potential benefits of filing likely outweigh the minimal effort involved. You might also want to check if she qualifies for any refundable credits - sometimes people with little to no income can still get credits that result in refunds. The good news is that a zero-income return is typically very straightforward to file, and many free filing options are available for her income level.