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Yaaayyyyyy, my teen has a j-o-b!!!

Updated: Jun 21, 2021

If you have teenagers and they are working summer jobs this blog is for you. While most of us stayed home last year we are all eager to get back out in the world and the workforce, even your kids!!! If you have teenage children and they are working summer jobs this blog is for you.

I thought a few guidelines about teens and taxes might be helpful so you can give your child good advice on how to handle their summer earnings wisely:

  • If your teen works part-time, fills out a W-4, and makes less than $12,550 in 2021, they generally won’t be required to file a return.

  • However, if your teen earns over $12,550 in 2021, they will need to file a return—independent of your own. Remember, filing a return for your teen does not hinder you from claiming them as a dependent on your return.

  • If your teen works as an independent contractor, they will receive Form 1099 at the end of the year, but only if they made more than $400. While they may not owe federal income tax (if they made less than $12,550), they will need to pay self-employment tax on their earnings.

  • If your teen starts their own business (lawn care, for example), they are self-employed and will need to pay self-employment tax on earnings more than $400.

  • If you hire your teen to work for your family business or your teen works as a “household employee,” there are special tax considerations to look into.

Bottom line: If your teen’s pay stub shows federal and state withholdings, there’s not much more they need to do. If your teen owns their own business or works as an independent contractor, you’ll need to keep an eye on their earnings and revisit the topic at tax time.

If you have questions, shoot me a quick email with your teen’s situation and I’ll do what I can to help.

Please keep in mind the info above is for informational purposes only and is not intended to provide tax, legal, or accounting advice—every situation is different.

Thanks for reading!!

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