Unemployed Filers

• Unemployed individuals may file federal tax returns whether or not they are required to file, according to the Internal Revenue Service. You might want to report even a small amount of income. Even though you are unemployed, the IRS requires you to file a tax return if your income reaches a certain level. In 2010, that level was $3,650 for a married person filing separately. For others, the level ranged from $9,350 to $16,150 depending on age, marital status, dependents and filing status.
  
  

Reportable Income

• The IRS lists many types of income that must be reported even if you are unemployed. Unearned income includes dividends, interest and survivor annuities. Earned income includes some scholarships and professional fees. Taxable income includes unemployment compensation, withdrawals from retirement funds, severance pay and pay for unused leave. Even if someone else can claim you as a dependent, you might be required to file a return.
  
  

Tax Credits

• The IRS lists several reasons why you should file a federal income tax return even if you are not required by law to do so. If you worked during the tax year, you might be entitled to a refund of federal taxes withheld from your pay or overpayments made in previous years. You might qualify for any of several tax credits, including the Earned Income Credit, or EIC, even if your earnings were low. You might qualify for the Making Work Pay Credit, child tax credit or education credits if you have returned to school. The health coverage tax credit is available to you if you receive assistance from the Trade Adjustment programs.
  
  

Other Reasons to File

• Unemployed filers can deduct job search expenses. Itemize your deductions to include the cost of travel, postage, employment agency fees and resume costs. A job loss can mean your income dropped significantly for the year, which makes you eligible for more deductions and credits. You may be able to deduct moving expenses if you relocated at least 50 miles away for a new job.