Surprise? For many and varied reasons, we have not paid income taxes for the past 24 years, and the simplicity of our financial status has kept us below the taxing level since the day we retired. Goverment bonds, IRA's and deferred annuity tax advantages greatly simplify our lives. Tax preparation takes about 1/2 hour for state and federal taxes, and the historical info fromTaxAct makes filing a non event.
We did make an early-on mistake for 2 years, when we turned 65, by not taking out some smaller investments, up to the exempt limit. With Social Security as a base and IRA withdrawals, the actual cash flow keeps us under the taxable limits.
We never planned it this way, it just happened. As we go forward, there will be some taxes, but this hapens at the same time our spending has gone down and spending needs decreased. Looking ahead to soon becoming a nonagenarian, we'll eventually pay some taxes, but overall, we are very grateful for the current US tax structure as it is designed to treat those with middling incomes.
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Adding a thought for those who could have parents who are in a similar "no tax" situation. Theoretically, not owing taxes, per se, would not require a person to file taxes....
EXCEPT... that not filing, implicitly allows the government to file for you. When the government does that, it assumes
ONLY the standard deduction, and no other deductions. ie. single return, not joint, and no other exemptions suchas over 65, blind, etc.
You may want to read this article on the legal points involved.
https://www.legalzoom.com/articles/what-are-the-penalties-for-not-filing-taxes
What if you fail to file?
The IRS may file what is known as a substitute return for you. However, as you well know, the IRS will not be looking to save you any money. In fact, a substitute return will not include any of the standard deductions your accountant would typically include in your return. Case in point, a substitute return only allows one exemption: single or married filing separate, so you end up with higher tax liability than if you would have just filed.