If you are an American citizen or permanent resident, you work or you are self-employed and you meet IRS requirements, you need to file a tax return. A tax return is a form you must fill out in which you report your income for the tax year, any deductions you have, tax credits you are allowed to claim and taxes you owe. Most types of income you receive must be included on this form.
Any earned income you have must be reported on your tax return. Earned income includes any type of income that is paid to you for services you provide and your job-related wage. Your employer is required to withhold federal taxes you have to pay from your wage (Medicare, Social Security and income tax). Your employer must report this information of Form W-2 and send it to you at the beginning of every year. (Employers have until Jan. 31 to send this form.) You use this form to report your job-related income on your tax return. Depending on the type of work you perform as a self-employed individual, you receive a 1099 form. You use this form to report your self-employed income to the IRS.
On your tax return, you must report to the IRS any income you received as an interest payment. This includes savings accounts you have that produce interest, your retirement accounts, interest on investments and business, dividends, royalties and distributions. Any type of income you receive that is produced as interest or a dividend is considered taxable income, and you need to report it on your tax return. Companies that pay you interest income or dividend income must also send you a 1099 form. You use this form to report your income to the IRS. You can receive different types of 1099 forms, such as the 1099-INT, the 1099-DIV or the 1099-A. The type of 1099 form you receive is related to the type of income you have.
Social Security Benefits
If you receive Social Security benefits, you might also need to report these benefits to the IRS when you file your return. As of 2011, you must report your Social Security benefits if half of the Social Security benefits plus all other types of income you have (including all types mentioned above) is higher than $25,000 in a year (for a single person) or than $32,000 in a year (for a married individual). You can use Form 1040 or Form 1040A to report this income. See Publication 915 for more information.
You might have received other types of income that are usually not produced on a regular basis. These types of income are called miscellaneous income for IRS purposes. These might include income receive as a host of an event or party, life insurance proceeds, accelerated death benefits, survivor benefits, unemployment benefits and campaign contributions (if they are used for personal purposes). If you have any income of this type in a year, you must report it to the IRS when you file your tax return.