Under what condition is a person required to report taxable income?

A person is required to report taxable income generally unless their income falls below a certain threshold, which determines whether they need to file a tax return or not. This threshold varies based on several factors such as filing status, age, and the type of income received.

In the context of option B, it correctly specifies that a person must report all taxable income unless it is small enough to exempt them from having to meet tax return filing requirements. The IRS provides guidelines on these thresholds, and if a person's gross income is below these amounts, they are not required to file a return.

This framework ensures that individuals are aware of their obligations to report income and comply with tax laws while also providing a safety net for those whose income is minimal and may not necessitate filing. Understanding these rules helps taxpayers to avoid potential penalties for non-reporting while complying with tax regulations.