I received this quick question the other day from a reader:
“If I lost my job last year and didn’t make that much, do I still have to file my taxes?”
And even though my response was brief and easy back to her, I figured I would put it here for anyone else who might have the same question. Just because you found yourself without work in 2008 at some point does not mean that you don’t have to pay your taxes. If you made money, you have to pay taxes. Granted, it might not be much (if anything) if you fall within the lowest tax bracket and you have expenses or take the standard deduction, but you still hypothetically owe taxes on any amount you made. Are you receiving a W-2? 1099’d your way through 2008? You probably owe something. You even have to pay taxes on any unemployment checks you received (you did file for them, right?). The one time I was on unemployment back during the dotcom bubble burst, I had the government take out their taxes before they sent me the check. That way I wouldn’t have owed anything if I had not found more work that year.
Taxes are a way of life and you have to pay them if you make any money during the year. The good news? You can probably pay your taxes online for free using something like the IRS E-File. The real trick in avoiding taxes is to not make any money, but I suppose living in your parent’s basement and sponging off them forever is not really in the cards for you. So sorry to be the bearer of bad news!