The deadline to file federal and state income taxes for 2013 is quickly approaching. H&R Block Senior Tax Advisor Michelle Bachtel says anyone who has federal income tax withheld from their income should file regardless of the requirement to file. She says by doing so they can either receive a refund or properly credit any tax obligation they owe. This includes many teenagers who work part-time after school or during the summer.
“Specifically obligation depends on three things: gross income, filing status and age,” Bachtel says. “Generally speaking, if your income exceeds those guidelines outlined by the IRS then you are required to file a tax return, and yes, children sometimes fall under those requirements.”
She adds all income is presumed taxable, with a few exceptions like child support, welfare and some tax-free interest. ”
Even Social Security can be taxable under the right circumstances. If you redeem a life insurance policy, the amount that exceeds the cost of the policy can be taxable, Bachtel says. An important thing to know is not all income is paid in the form of cash. Sometimes there’s income from bartering, which is the exchange of goods and services. If there’s a profit made on those, then yes, that is considered income.”
Visit www.IRS.gov for detailed information about federal taxes. Bachtel is the guest on tomorrow’s Kanakee Valley Viewpoint’s show, which airs at noon Central, 1 p.m. Eastern on WKVI-FM.