How To File a Tax Return When You Have No Income (And Why You Might Want To)

If your income is below the filing requirement, there is no need to file a federal tax return. But for some people, it still makes sense to file.

If your income is below the filing requirement, there is no need to file a federal tax return. But for some people, it still makes sense.


There are two main reasons for filing a US income tax return even if you don’t have any income to report.


1.  Identity theft, and
2.  Identity theft.


I realize it looks like I was repeating myself but I wasn‘t.  I’m talking about two different kinds of identity theft.  The first is related to an unauthorized person claiming your kids as dependents on their tax return.  The second involves someone claiming you, or impersonating you, on a tax return.


Let’s talk about your kids first.  Here’s a story I’ve heard several times:


“I’m on SSI and I support my daughter 100%.  We get nothing from her father but he claims her every year on his tax return and gets thousands of dollars in refund money.  I reported him to the IRS but I haven’t heard anything.  I tried to file a tax return but other tax company said I don’t have income so I can’t file.   Is there anything I can do to stop him from profiting on my child that he never sees?”



One way to deal with this issue is to report the tax fraud.  Here’s more information about how to do that:  But here’s the thing–the IRS will never tell you what happens.  You’ll never know if the fraud stops.  You might not have enough information to give to the IRS to stop the fraud.  But if you file a tax return and claim your child as a dependent–that messes up their computers and something is going to happen.   The IRS will have to deal with the issue.  You’ll need to be prepared to prove that your child lives with you to stop your ex from claiming your child, but hey–with no income, you’re not getting a refund.  You’ve got nothing to lose!


Here’s another story that I don’t hear as often, but I have had to deal with before:


I got a letter from the IRS saying that my tax return is wrong and that I shouldn’t have claimed those kids.  I don’t understand, I don’t have any kids and I never filed a tax return.  What’s going on?



Fraud isn’t limited to claiming kids that aren’t yours; the fraudsters will also use a non-filer’s identity to claim kids that aren’t theirs for huge refunds and then when the IRS investigates, some innocent person who never filed a return gets caught and gets fined.  It’s a nightmare to sort this all out.


So how do you protect yourself?  File a tax return.


Just because you don’t have any taxable income doesn’t mean you can’t file a tax return.  You won’t get any money back, but you can still file an information return just to let the IRS know that you’re out there.  Many software programs won’t process the return if you show no income, so you’ll want to plug $1 into the other income section on line 21 for the long form.


You can even file for free with no income from my website.  Just go to the “Do Your Own Taxes” tab at the top.  Of course, you can always go to the website and use their Free File Online instead.  The important thing is that you file a return and protect yourself.

Protecting Your Identity

Scary Identity Thief

Photo by David Goehring on

With your name, birth date, and social security number, I can ruin you.  Now I wouldn’t– I have laws to follow and a code of ethics too, but basically those are all the tools an identity thief needs to ruin your life.

Scary isn’t it?  And how easy is it to get that information?   Got a Facebook page?  There’s your name.  Did you post your birthday on it for all your friends?  That’s two.  The social security number is harder to get—or at least it should be.

Do you have a driver’s license that uses your social security number as the ID number?   Do you keep your social security card in your purse?  Both of those practices are extremely dangerous.

Why am I obsessing over identity theft in my tax blog?  It’s a really hot issue in taxes this year.  Fake tax returns reflecting huge refunds have risen exponentially, and the IRS is having a hard time fighting the phenomena.  I’ve written about children’s identities being stolen for tax returns before, but the issue of adult identities being stolen is what has really caused problems this past season.

Here’s the thing:  A fraudulent tax return gets filed in your name with a large refund.   You go to file your taxes, maybe you even owe, but you can’t file because your identity has already been claimed.  Next thing you know, you’re under criminal investigation for tax fraud.  Ugly, isn’t it?  You don’t want this to be you.

What can you do?   Prevention is the best.  Guard your social security number like your life depended upon it.  It does.  Take your birthday down from your Facebook page.   My apologies to everyone who’s sent me requests to sign up for the birthday club—sorry, I just won’t do it.

If you do get hit, be sure to report it right away.  Even if the police will do nothing about your case, you’ll have the fact of reporting it on file.  If you’ve been the victim of identity theft for tax purposes, you’ll need to fill out the IRS Identity Theft Affidavit, Form 14039.  Here’s a link to get it:

Even if you haven’t been affected by tax identity theft, if your purse has been stolen and your social security number is at risk, you should contact the IRS before a problem comes up.  You can call this number for assistance:  1 800-908-4490.  That’s the IRS Identity Protection specialized Unit.  They can take steps in
advance to protect your account.

I worked on an identity theft case years ago, before it was a common problem.  It was a nightmare—because not only had the man’s identity been stolen, but the IRS was charging him with fines, penalties, and tax fraud for getting a huge tax refund for claiming some children that weren’t his.   It all started with an IRS letter asking him if Billy and Susie were his children.  He responded back saying , “No,”  he didn’t have any children at all.  He wasn’t thinking about identity theft, he was thinking that maybe an old girlfriend was trying to pin paternity on him for some kids that weren’t his.   He had no idea that it was the beginning of a tax problem that took over a year to solve.

He hadn’t filed a tax return for that year due to lack of work, so he was a good candidate for identity theft.  Once the IRS determined that the return as fraudulent, they weren’t looking for someone else—they went to my client who happened to have the name and social security number on the tax return.   Like I said, it was a nightmare.

So be careful.  Protect yourself and your social security number.  You’ll be glad you did.