As being a provider of professional tax services in Kissimmee, Orlando and Hunters Creek FL, we know that as a minor of the state, there are many laws and rules and regulations enforced to safeguard the rights of any individual considered to be underage. As an underage person, you get to enjoy all the benefits and shoulder none of the responsibility of being an adult. You are exempt from many laws that are applicable to adults and while the government may severely punish the adults, you’re given a frown and allowed an exemption in most situations.
However, more and more teenagers are opting towards part time work as a step towards independency and to meet their own financial needs. Looking at this growing trend and the fact that most minors are able to amass a considerable yearly income, the IRS has revised its tax returns laws where age is not the discerning factor regarding eligibility to file tax returns.
Although most parents are affronted by the idea of their child having to pay taxes, it should be seen that the Government views them as well rounded individuals who are already contributing towards the growth of their society. However, the good news is that the IRS has a mandatory number that defines the cut off level and the eligibility criteria for filing tax returns and age is not a factor for them. Here are a few ways that you can decide if your child is eligible or not:
This indicates that if your child’s yearly income tax exceeds the mandatory amount then they are considered eligible to file for taxes. The IRS has an amount fixed every year so you might consider checking with them first before you decide if your child is exempt from filing tax returns or not. In 2012, the mandatory amount was a yearly income of $5800 or more.
Earned and Unearned Income
As a minor, there are two types of income that can get taxed; earned and unearned income. Unearned income indicates all income in the form of bonds or interest. If your child is considered to be eligible for tax returns and has both means of earned income and unearned income, their tax returns will be calculated by adding together both the amounts.
Your child may also be eligible for tax returns if he is utilizing benefits like social security or medical care. Furthermore, if he is self-employed, then he may be eligible to file tax returns based under the Self-Employment tax.
Despite the fact that parents consider this as an added hassle since taxes are already too confusing to file in, don’t consider ignoring the tax returns for your child. It can be beneficial for your child and give him a good idea of what to expect when filing his taxes himself. Furthermore, if your child has had his taxes withheld on his income through his employer on his paycheck, he could file his tax returns in Kissimmee, Orlnado, Hunters Creek FL, and obtain a refund.
If you are confused about how to go about this, then don’t hesitate to contact a tax professional. With their sole purpose of business being to provide tax related services, they can definitely assist you and your child in deducing his eligibility criteria.
If you require any more information regarding tax preparation services, tax debt payments and procedures; please feel free to contact us at 407-344-1012 for more information. God bless.