Does My Teenager Need to File a Tax Return?

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This is a common question this time of year. Here’s an example:

My 17-year-old son worked part-time at Hy-Vee last summer and made $980. No income taxes were withheld. Does he need to file a tax return?

When a Dependent Needs to File a Return

Let’s look at the rules for when a dependent needs to file a tax return. For reference, see Table 1-2 on page 7 of this year’s IRS Publication 17.

When a dependent is single and under age 65, as in the case of a teenage child, they need to file a tax return if:

  1. Their unearned income (interest, dividends, capital gains) was more than $1,050, or
  2. Their earned income was more than $6,350, or
  3. Their gross income was more than the larger of: $1,050 or earned income up to $6,000, plus $350.

Let’s go through each of these one-by-one with our example.

ONE: in our scenario, the child has no unearned income. This item doesn’t apply, so we go on to item two.

TWO: the child’s earned income was $980, well below the $6,350 limit. This item doesn’t apply, so we go on to item two.

THREE: This item asks us to look at gross income, which in our scenario is $980. This is not more than $1,050, nor is it more than earned income plus $350 (which would be $1,330 in our case). Item three also doesn’t apply.

(NOTE: item 3 is basically saying a child can have earned income of up to $6,350 without needing to file a return.)

In our example here, of the three items applies, so the child doesn’t need to file a tax return.

What if Taxes Were Withheld?

Let’s say the child made $980 of income, and the employer withheld $49 of income taxes from their pay. In this case, you could choose to file a tax return to get a refund of the withheld taxes.

(ANOTHER NOTE: “withholding” and “withheld taxes” in this circumstance refers only to income taxes, not to FICA taxes.)