Teens & Taxes: How Does Declaring Your Employed Teenager as a Dependent Affect Their Taxes?

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If your teenager is earning an income and filing taxes as a W-2 employee or a 1099 independent contractor (self-employed), you might wonder how claiming them as a dependent will affect their tax returns.

Explore: Quick Tips for First-Time Filers (and Their Parents)
Find: What Documents Does Your Child Need to File Taxes?

First, it’s important to note that you cannot claim your dependent’s earned income on your tax return. They must file their own if they owe money to the Internal Revenue Service. If they believe they might be getting a refund for overpayment of taxes in 2021, they will also want to file.

When your teenager files their taxes, they will need to check the box on their tax return that says, “Someone can claim you as a dependent.”

See: How Much Can Your Teen Make Before Needing to File Taxes?
Prepare: Does Your Teenager Need a Bank Account To Receive a Tax Refund?

If your teen doesn’t work but has investment income, you can claim them as a dependent on your taxes as long as they meet the criteria for being a dependent. Your teen would not have to file taxes as long as that unearned income is less than $10,500. In that case, you’d declare your teen as a dependent and include the teen’s income as part of your household income on your tax return.

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About the Author

Dawn Allcot is a full-time freelance writer and content marketing specialist who geeks out about finance, e-commerce, technology, and real estate. Her lengthy list of publishing credits include Bankrate, Lending Tree, and Chase Bank. She is the founder and owner of GeekTravelGuide.net, a travel, technology, and entertainment website. She lives on Long Island, New York, with a veritable menagerie that includes 2 cats, a rambunctious kitten, and three lizards of varying sizes and personalities – plus her two kids and husband. Find her on Twitter, @DawnAllcot.

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