Hi.  I live in California, and I started a small garden design
business last year, which I ran from my home.  I made somewhere
between $6,000.00 - $7,000.00.  I had no other income, aside from a
small amount from interest, likely less than $200.00.  I have no
assets. I'm single, and I supported myself via my savings.  Do I need
to file a federal and/or state tax return?  If so, does my
self-employment status affect my ability to receive an extension, or
the length of the extension?

Thanks so much!

nerv...

According to the instructions on Form 1040:

IF your filing status is Single, and you were are 65, and your
income was at least $8,200 (working for someone else), you must
file. If you are 65 or older, and your income was at least 9,450
(working for someone else), you must file.
http://www.irs.gov/pub/irs-pdf/i1040.pdf

However, you are essentially self-employed. The instructions for
Schedule SE, for those who are self-employed, notes:

"You must file Schedule SE if:

 Your net earnings from self-employment (see page SE-2) from
 other than church employee income were $400 or more"

and

"You must pay SE tax if you had net earnings of $400 or more
 as a self-employed person. If you are in business for yourself
 or you are a farmer, you are self-employed."
http://www.irs.gov/instructions/i1040sse/ch01.html#d0e43


While your exemption and standard deduction will add up to the
$8200, and preclude the need for you to pay income tax, you 
will be required to pay self-employment taxes, which will be
calculated on Schedule SE. They are the FICA and Social Security
taxes that would have been withheld from income earned from an
employer, and must be withheld from your income, as well.

Who must file, both for employed and self-employed individuals,
is further outlined on this page from the IRS site:

"You must file a tax return if you had net earnings from self
 ?employment of $400 or more. This is your total self-employment
 income less the expenses paid in operating your trade or business,
 multiplied by 92.35%. For more details, refer to Topic 554,
 Self?Employment Tax."
http://www.irs.gov/taxtopics/tc351.html

Topic 554 - Self?Employment Tax:
http://www.irs.gov/taxtopics/tc554.html


Self-employment has no effect on eligibility for extensions
or the length thereof. Guidelines for everyone are here:
http://www.irs.gov/newsroom/article/0,,id=108542,00.html


State taxes are based on your Adjusted Gross Income from Form
1040, and chances are good that, just as you will owe no 
Federal taxes, you won't owe any State taxes either. You will
need to obtain a copy of your State Tax Return to determine
the minimum Adjusted Gross Income required in order to 
necessitate the filing of a State Return.


Additional information may be found from an exploration of
the links resulting from the Google searches outlined below.

sublime1-ga


Searches done, via Google:

"who must file" site:www.irs.gov
://www.google.com/search?q=%22who+must+file%22+site%3Awww.irs.gov

"who must file" "self-employed" site:www.irs.gov
://www.google.com/search?q=%22who+must+file%22+%22self-employed%22+site%3Awww.irs.gov

extension site:www.irs.gov
://www.google.com/search?q=extension+site%3Awww.irs.gov

extension "self-employed" site:www.irs.gov
://www.google.com/search?q=extension+%22self-employed%22+site%3Awww.irs.gov

---

Clarification of Answer by sublime1-ga on 28 Mar 2006 10:50 PST

nerv...

The first paragraph should read:

According to the instructions on Form 1040:

IF your filing status is Single, and you were UNDER 65, and your
income was at least $8,200 (working for someone else), you must
file. If you are 65 or older, and your income was at least 9,450
(working for someone else), you must file.
http://www.irs.gov/pub/irs-pdf/i1040.pdf