2020 Tax Return with Zero Income in 2020

Question:
How to prepare and eFile a 2020 Tax Return with zero taxable income.
Article, Solution:

Instructions to prepare and eFile a 2020 Tax Return for Individuals who are not normally required to file tax returns but are eligible for the stimulus payments via the the refundable Recovery Rebate tax credit. Important: Use this tool to see if you were eligible for the 1. stimulus and this for the 2. stimulus payment.

Please follow the instructions below ONLY to eFile a 2020 tax return if you had 0 zero income income during 2020 or are general not required to file a tax return. In some cases you can also use these instructions to file your return if you had 0 Income in 2020 and if your spouse filed a tax return as Married Filing Separately. The instructions below do NOT apply for social security income recipients etc. All social security recipients please follow these instructions.

  • Attention: It's very important to know that the zero Income 2020 tax return is NOT TO BE used if you did have 2020 taxable income or social security income in order to receive the 1. and/or 2. stimulus payment(s) via the Refundable Tax Credit. Only follow these instructions if you indeed had zero income in 2020. All others, must follow these instructions.

Here we go, if you had zero income in 2020 and generally do not file a return:

  1. Create your free eFile.com account or Sign into your eFile.com account.
  2. Start the tax interview process by entering your personal details on the "Name & Address" screen (not shown below). At the end click "Save"
  3. Then, click on Help in the top menu section as shown below.
    Zero Income Tax Return - Click Help

  4. Enter "Recovery Rebate Credit" in the Help search box, click on "Add form" next to Recovery Rebate Credit.
    Zero Income Tax Return - Search Recovery Rebate
     
  5. Recovery Rebate Entry Screen for the 1. Stimulus Payment

    If you received the 1. Stimulus Payment or Economic Impact Payment in 2020 enter the amount you received or the amount listed on notice 1444 and mailed to you from the IRS. If you DID NOT receive a 1. stimulus payment enter "0" (zero). If you did not get notice 1444 or have since discarded it, please enter the amount you received as your 1. stimulus payment.

    Recovery Rebate

  6. Recovery Rebate Entry Screen for the 2. Stimulus Payment

     If you received the 2. Stimulus Payment in 2021 enter the amount you received or the amount stated on notice 1444-B mailed to you from the IRS. If you DID NOT receive your 2. Stimulus Payment for any of the reasons outlined here, enter "0" (zero). If you did not receive notice 1444-B or have since discarded it, please enter the amount you received as your 2. stimulus payment.

    Recovery Rebate

    Make sure you keep and save the letter from the IRS with your 2020 tax return records. You will need the Economic Impact Payment amount you received as stated in the letter from the IRS Notice 1444 for your 1. Stimulus payment  and/or 1444-B for the 2. Stimulus payment. If you DID NOT receive for any reason the 1. and/or 2. stimulus payment, enter a 0 - as in number zero - on the Recovery Rebate Pages on your 2020 tax return.

  7. Click Yes or No to answer the question about if you or your spouse was a member of the U.S. Armed Forces at any time during 2020.
    Zero Income Tax Return - Member of Armed Forces

  8. Click Save.
    Zero Income Tax Return - Save Recovery Rebate Credit

  9. Click on Federal Taxes in the left green menu. Then, Click on Review under Federal Taxes.
    Zero Income Tax Return - Click Federal Taxes

  10. Answer the two remaining questions in the Review section of Federal Taxes.
    Zero Income Tax Return - Virtual Currency
    Zero Income Tax Return - Foreign Accounts

  11. Click "Finished with Federal" button.
    Zero Income Tax Return - Finished Federal

  12. Click link "No thanks" to skip the State Tax Return preparation process.
    Zero Income Tax Return - No State

  13. You will now be on the File screen and can proceed to e-File your 2020 Tax Return. See the steps on how to efile.

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