Teens & Taxes: What Can My Teen Deduct on Their Taxes If They Have a Gig Job?
Teenagers — and adults, for that matter — who take on gig work, side jobs, or consider themselves self-employed will receive a 1099-NEC form for any earnings of $600 or more. If a self-employed person shows a net income of more than $400 for “non-employee compensation” they are responsible for reporting this income to the IRS and paying self-employment taxes on it. If your teen receives any 1099-NEC forms for gig work, they must report that income, even if their net earnings do not exceed $400.
Is your teen showing a profit for their gig work? If they received a 1099-NEC form, they need to report the income. But, depending on their deductible expenses from their gig, they may not have to pay self-employment taxes.
Allowable deductions do not depend on the taxpayer’s age. But teens may find they have fewer deductions, as they typically can’t write off part of a mortgage for a home office or utilities expenses, which are usually paid by a parent or guardian.
However, some allowable tax deductions for teens, depending on the gig they worked, might include:
- Vehicle expenses, at a rate of 58.5 cents per mile.
- Contributions to an IRA account.
- Self-employment taxes.
- Office supplies.
- Postage and mailing supplies.
- Computer purchases.
- Smartphone purchases and plan (if the teen pays the bill and it is in their name).
- Business travel and meals, including up to 100% of the cost of restaurant meals.
- Marketing and advertising expenses (such as advertising, business cards, or flyers).
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