If I didn't work at all in 2007 will I end up paying the IRS, instead of receiving money back? I worked from 05-06 but I decided to become a full time student in 07 and hadn't worked at all this year. Will I owe money?
2007-12-11 13:36:43 · 2 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
So how is it that some people end up owing money?? I could never figure this out.
2007-12-11 13:52:43 · update #1
If you have no income, you owe no tax. And if you paid nothing in, there's nothing to be refunded.
Addendum: Nobody with no income winds up owing. Period. People who underpay their tax liability will wind up owing -- I do every year, deliberately since I hate making interest free loans to the government. But if you have no tax liability you'll never wind up owing.
2007-12-11 13:48:01 · answer #1 · answered by Bostonian In MO 7 · 4⤊ 1⤋
If you didn't have income, no you won't owe, but no you won't get a refund either.
You get a refund for one of two ways. Either you pay in too much in withholding from your paychecks and get the extra refunded to you, or you qualify for a refundable credit, either the additional child tax credit or the earned income credit. To be eligible for either of the refundable credits, you have to have EARNED income. So no, you don't get anything back - you didn't pay anything in.
People end up owing if they have too little withheld from their paychecks, so there isn't enough paid in to cover the tax they owe. Then they have to pay when they file their return.
2007-12-11 14:30:20 · answer #2 · answered by Judy 7 · 2⤊ 0⤋