I've been on workers comp. for the whole year of 2007. I receive tax free money from my company. Will I receive the same deductions as a normal person?
2007-10-19 01:41:08 · 8 answers · asked by EYES WIDE OPEN 2 in Business & Finance ➔ Taxes ➔ United States
If this is your only income there is no need to file. Workers Comp is not taxable. Since your taxable income will be below the filing threshhold amount there is no need to file.
Since your income is non-taxable unearned income there are no credits that you would qualify for so there's no need to file even for that purpose.
Please ignore the rubes who say that Workers Comp is taxable or that you must file a return if you have any income at all. They don't know what they're talking about. See IRS Pubs 17, 501, and 525 for further information.
2007-10-19 01:57:56 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Workman's comp IS taxable income. I do not believe that your company CAN give you so called "free money". If you did not have an income then no you wouldn't have to file. Just don't be surprised at the end of the year when your company gives you a 1099 for Monies you have received. You may fall under the minimum income and NOT owe any taxes. But remember this The Democrats If they are elected will lower the minimum tax bracket. They will also get rid of the child tax credit which has given Low income families several thousand dollars every year. I just can't understand how the poor with Children could vote for a democrat. OF COURSE WHEN THE TAX CREDIT IS GONE IT WILL BE GEORGE BUSHES FAULT.
2007-10-19 01:51:47 · answer #2 · answered by chuck t 4 · 0⤊ 2⤋
If you receive any kind of income at all, you have to file. Your idea of tax-free money and the IRS's may be very different. Just because your company isn't withholding tax from it does not mean you won't owe tax. You might or you might not. Your deductions, to the extent you have any, won't be affected. You'll still get the personal exemption and standard deduction everyone else gets. But you have to file.
2007-10-19 01:53:43 · answer #3 · answered by curtisports2 7 · 1⤊ 1⤋
Workers Comp isn't taxable as you said, so you have no need to file. You don't get any deductions if you don't have any taxable income - there's nothing to deduct them from.
2007-10-19 03:28:35 · answer #4 · answered by Judy 7 · 0⤊ 0⤋
Deductions reduce income subject to tax. If you have no income subject to tax, you have no need for deductions.
You are required to file if you have income subject to tax at or above the filing requirement. For example, a single taxpayer under age 65 with $8,750 or more income subject to tax must file a tax return.
2007-10-19 01:49:49 · answer #5 · answered by ninasgramma 7 · 1⤊ 0⤋
Workers comp is non taxable income. Your employer is liable for the taxes. And since you didn't have any earned income, you can't claim the earned income credit either.
If your employer didn't pay the taxes you need to notify OSHA.
Chances are they did pay the taxes.
You can call any CPA and they will be able to answer all your concerns. GOOD LUCK!!!!
2007-10-19 02:02:16 · answer #6 · answered by Anonymous · 0⤊ 1⤋
yeah, you need to file, but you need to do the alternative tax formula as well. I took a year off from life and lived on savings, didn't file, and they sent me a nastygram a few years later. Do it just to cya.
2007-10-19 01:45:17 · answer #7 · answered by Zipperhead 6 · 0⤊ 1⤋
you should calculate whether your income exceeds your personal allowance taking into consideration any tax deductable expenses you may find you are eligible for a tax rebate
2007-10-19 01:49:54 · answer #8 · answered by Paddy 4 · 0⤊ 1⤋