Teens & Taxes: Does Your Teen Need To File Taxes for Their Part-time Job?

The active senior, 77-years-old, African-American businesswoman, business owner, teaching the new employee, the 18-years-old Caucasian white girl, how to use the computerized cash register in the small local restaurant.
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If your teen took advantage of the tight labor market in 2021 to work their first part-time job, they could be facing another first this year: filing taxes. Depending on your teen’s age, as a parent you might take an active role in the process, guiding them through the steps of filing.

See: Teens & Taxes: Quick Tips for First-Time Filers (and Their Parents)
Find: The 4 Best Bank Account Options for Kids and Teens

First, it’s important to determine if they need to file taxes or not. There are several scenarios in which they might have to file taxes.

Your Teen Made More than $12,550

If your teen earned $12,550 or more at their part time job, they need to file taxes for 2021. Most teens working only 20 hours a week through the year — or full-time in the summer with reduced hours during the school year — will not meet that threshold if they earned even as much as $10 an hour.

If you live in a state with high minimum wage or your teen snagged a well-paying summer job, make sure to look at the gross income on their W-2 form to determine if they need to file taxes. If that number exceeds $12,550, they will.

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Your Teen Earned Cash Tips

If your teen worked in a restaurant, hotel, or other hospitality venue, they may have received tips as part of their income. IRS law requires employees to file a record of tips with their employer, so the employer can pay the appropriate Social Security and Medicare taxes on that money.

Your teen should report that income on their tax returns so they can pay their share of the taxes by April 15, according to the IRS website.

Your Teen’s Employer Took Out Withholding Taxes

Even if your teen did not earn $12,550 throughout the year, they may want to file a tax return if their withholding taxes were overpaid. If they can get money back, it’s worth it to file, especially if they use a free e-file service.

See: Don’t Usually File Taxes? Here’s Why You May Need To
Find: Income Reporting: How To Avoid Undue Taxes While Using Cash App

Your Teen Received Investment Income in Addition to a Paycheck

If your teen received interest or dividends from stocks, savings accounts or other investments and worked a part-time job, they might have to file a tax return. If the gross income between their part-time job and investments equals more than their earned income plus $350, they must file a return — even if that amount does not meet the standard deduction amount of $12,550.

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If you aren’t sure if your teen should file based on this information, consult with your family’s tax preparer or another tax professional.

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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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