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Changes that occur in your life affect whether you need to pay
taxes and the amount you pay. While this publication doesn’t con-
tain all the answers for you, it may make you aware of some issues
See IRS Publication 502, Medical and Executors and Administrators, is designed
and direct you to other sources of information. Dental Expenses. to show you how to complete and file
• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • federal income tax returns and point out
Suppose I hire someone to help your filing status, age, and gross income. What if I sell my house? your responsibility to pay any taxes due.
me? What if I get paid for doing odd
When your filing status changes, the level of If you had a gain from the sale of your main See IRS Publication 559, survivors,
jobs?
income that requires you to file an income tax home, you may be able to exclude up to Executors and Administrators.
If you had a household worker (for example, return also changes. $250,000 (or $500,000 on a joint return) in • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •
a housekeeper, caregiver, or gardener), you See IRS Publication 501, Exemptions, most cases. Should I worry about estate taxes?
may need to pay employment taxes. You
Standard Deduction, and Filing See IRS Publication 554, Older Suppose I give gifts?
may also need to withhold social security Information.
Americans’ Tax Guide, for more Generally an estate tax return only needs
and Medicare taxes. • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •
information on selling your home. to be filed if the value of the estate exceeds
See IRS Publication 926, Household What counts as income? • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •
the amount applicable for that year.
Employer’s Tax Guide. Generally income is taxable unless specifically Do I qualify for any special tax
There is usually no tax if you make a gift to
exempted by law. While life insurance pro-
Any income you receive from doing credits? your spouse. If you make a gift to someone
ceeds are rarely taxable, part of your Social
odd jobs is considered self-employment Generally tax credits reduce the amount of else, the gift tax does not apply if your
Security benefits and IRA distributions may
income. If your net earnings from self- tax you owe. Some credits may create a gift to that person is less than the annual
count as income.
employment are $400 or more, you may refund, even if you paid little or no tax. exclusion amount (see Publication 950 for
be subject to self-employment tax even if See IRS Publication 554, Older Americans’ the current annual exclusion).
Tax Guide, for more information on The Earned Income Tax Credit (EITC) may be
you are already getting social security or
income issues of interest to seniors. available if you are working and your earnings For an overview of estate and gift taxes,
Medicare benefits.
are low. The credit may be larger if you have see IRS Publication 950, Introduction to
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See IRS Publication 533, a qualifying child (including a grandchild). If Estate and Gift Taxes.
Self-Employment Tax. Should I pay estimated taxes? you do not have a qualifying child, you must
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• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • Changes in your filing status and income may be under age 65 to qualify for the EITC. What tax or financial records should
What other tax issues do I need to mean that you owe taxes. You may need to
See Publication 596, Earned Income I keep and for how long?
think about? pay amounts throughout the year if you will
owe $1,000 or more when you file your tax Credit. You should keep receipts, canceled checks,
If you have questions regarding powers
return. By using IRS Form 1040-ES, Estimated The Credit for the Elderly or the Disabled may and any other records to help you prepare a
of attorney, bad debts or other tax issues,
Tax for Individuals, you can pay your tax in reduce your tax under certain conditions if complete and accurate income tax return.
there are more resources to help you. Please
four payments during the year. your income is very low. You should keep these records for as long
call the numbers listed in this brochure, or as they may be needed to support the items
check irs.gov for more information. See IRS Publication 505, Tax Withholding See Publication 524, Credit for the Elderly
claimed on your return (generally, at least
• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • and Estimated Tax, for more information. or the Disabled, for more information.
three years). Records relating to assets
FREQUENTLY ASKED QUESTIONS • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • (home, car, etc.) bought and sold should be
How do I deduct medical expenses? What income tax issues do I need to kept as long as you own the asset.
What is my filing status now? Do I know about the year my spouse
If you are able to itemize your deductions, you
even have to file? dies? For more information on recordkeeping,
may be able to deduct amounts you paid for see IRS Publication 552, Recordkeeping
Your tax filing status is a category that certain medical and dental expenses that were If your spouse died during the past year and
for Individuals.
identifies you, based on your marital situa- not covered by insurance. These expenses you have not remarried, you may still file a
tion on the last day of the year. Whether include amounts you paid for doctors, joint return. A joint return will generally result
you have to file a tax return depends on hospitals, and prescription drugs. in less tax. IRS Publication 559, Survivors,
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