IRS, 2018, new tax table minimums, does one merely stop filing a 1040 ?

catch22

A chit-chat question today with a friend.

---Who...........65 years old or older, filing as widower, receives husband's pension, NO federal or state taxes withheld through the year. So, in effect; no tax refund to be claimed.

The 2017 minimum income requirement for need to file was: $18,000.
For 2018 (new tax laws), the minimum requirement is now: $25,300.

The person had to file in 2017 because of the above 2017 minimum. But, their pension income for 2018 is below the new $25,300 amount.

The question(s): Does one merely stop filing (IRS is aware of income amount via form 1099); or is there a form that needs to be processed to the IRS, as in; "I don't need to file", or a self generated "Dear IRS", I don't need to file letter?

Thank you for your input.
Regards,
Catch

Ted

@catch22: I believe the answer is yes. Your friend should file a 1040.
Regards,
Ted
Form 1040 Instructions:
https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

catch22

Hi @Ted
Thanks for your input.
I had looked at the IRS pdf earlier, too.
The person had a total of $19,065 2018 pension income.....no other income and no taxes were withheld from the monthly pension payment (no refund of taxes paid to recover).
The 2018 requirement is that one must file, being over age 65 or older, widower IF income exceeds $25,300.

msf

Generally speaking, if one's taxable income is below the standard deduction, one don't need to file anything. (Hard to find a reference explicitly stating that beyond not filing a 1040 you also don't need to file anything else.)

However, as this quick IRS interactive site shows, there are exceptions.
https://www.irs.gov/help/ita/do-i-need-to-file-a-tax-return (To make sure no taxes/credits involved)

For example, if one took money out of an HSA, one has to file an 8889 and thus a 1040. Or if one took an ACA advance premium credit, one must file a tax return. Conversely, if one didn't take an advance credit but should get a credit (i.e. 2018 ACA insurance was subsidized), one will want to file a tax return to get that refundable credit. It may be worth a few minutes running through the tool to make double check everything.

Qualifying widower requirements.
https://apps.irs.gov/app/vita/content/globalmedia/4491_filing_status.pdf

MikeM

I'm assuming her pension+ss+Interest from taxable savings accounts+any withdrawals from a tax deferred account is less than the $25,300 minimum. And she haad zero dollars taken out from any of those incomes (which she would get back by being under minimum.)

I think she can just stop filing if she is under the minimum and paid no tax on any of the above I mentioned (no refund coming). There may be benefits though in having a completed 1040. I know I used to take my mothers income, which wasn't much, to AARP volunteers to have them complete tax forms for her for free. We were asked to show those 1040's a few times for various proof of earnings for different situations, the STAR program, assisted living application, ect.... I'd recommend she continue the process just for recording sake.

catch22

@MikeM
Correct, total income for 2018 is $19,065 from pension only.......no income from any other source, CD's, bank accounts, etc. This may read a bit strange for many; but the pension is from U.S. Postal system; and the older pension program was strictly this and did not involve either Social Security or Medicare payments withdrawn from gross pay. So, there is no involvement with either of these systems.
Quite uncommon, for sure.
I would guess that, and I will stress...guess....that future income proof needs would be satisfied via a 1099-R form, without need for showing a 1040 filing for a given year.
Thank you for your thoughts with this.
Catch

MikeM

Thanks for the clarification @catch22. Sounds like she doesn't have to file, but like I mentioned, 1040's are sometimes useful for a record of income for whatever life brings. Does she have access to free AARP tax filing for seniors? If so I would recommend to her or help her use that service.

catch22

@MikeM
Sometime this week, I should have an opportunity to clarify more info about this person's filing status. They had stated "widow", but I don't think they understand the IRS qualification for this. I don't know enough personal history to fully assume, but I do believe this person has been widowed for about 10 years. This would mean the filing would have to be as "single" status and would require a 1040 based upon their income, as the $ limit is very much lower.
@msf Also thank you to you, too; for your help.

Ben

Hmm... a widower is a man whose spouse has died. A widow is a woman whose spouse has died. No gender is specified here. At any rate does the "widower" receive no social security money? Waiting to become 70.5 years old? I understand that the deceased spouse's pension did not involve Social Security but did the surviving spouse never pay into the SS system? I may not be able to come up with useful advice but if I can it would help to understand the situation more fully.

catch22

Hi @Ben
My typo regarding widower/widow. Thank you for finding the error, and I have corrected.
The lady in question is in her 80's and did not work outside the home and therefore no SS payment. Valid question.
Only the spousal/husband pension for income.
And as noted just previous, I feel that she will indeed need to file single status; and that those checking information tripped upon the "qualified widow" status and thought that this would apply to her 2018 tax reporting.
Thank you for your time with this.
Regards,
Catch