Newbie to the Workforce? Tax Rules for Summer Jobs

Ah, the long summer days of scooping ice cream, dragging water-drenched rafts and watching the neighbor kids for hours on end.  If your teen or tween is hauling in the cash, it might mean they will owe the IRS a few pennies.

Does your child have a summer job? If your kiddo meets the following criteria, you’ll likely have to file on their behalf.

Here are the conditions in which it’s necessary to file for a minor:

  • Unearned income is greater than $1,050 (this includes dividends and interest on savings accounts or other investments)
  • Your child makes more than $6,300 at their lifeguarding and lemonade stand
  • They bracelet business they started in the garage? If it earns more than $400, it means the self-employment net earrings are high enough to warrant filing

Here are the easiest ways to file for a minor:

If the minor is under 19 or a full-time student under the age of 24, and the child’s income is less than $1500, it can be attached to a parent’s return using the form 8814 (qualified dividends or capital gains may increase)

If you want to ensure the tax man doesn’t hit hard, a minor can file his or her own return–which we can help with here at AF Gebauer and Company.

Even if not required to file, a minor can elect to file-which might be smart if he or she had money withheld from a part-time job and they want to receive a refund.

For more information on the special rules regarding the Kiddie Tax, please contact us!


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