Can I legally claim expempt?

Question

Please only answer if you know for sure. I am 16 years old and I didn't pay any taxes last year, (this is my first summer working). I claimed 0 on my W-4 this year at my summer job. Can I change that to exempt? I'll probably make about $2000 or a little more. I've heard something like if you make over 900 dollars a year it is illegal to claim exempt or something? But I've also heard so many other things. I also filled in at an office just last week and they want me to fill out a W-4 to pay me. I only made about 250 dollars, can I claim exempt on that form. I really know NOTHING about taxes or any of this stuff so please explain in VERY SIMPLE terms, haha. Thanks so much!

Answer 1

YES you can! Is that simple enough!  For 2008 doing so with income under $5,450 will have no consequences.

Answer 2

By "exempt" do you mean exempt from withholding? If so, the ONLY group exempt are non-resident aliens living and working in the US. If you claimed to be exempt and are NOT, this could come back to bite you later. You need the services of a tax consultant to get the right numbers, but if I remember correctly, you have to declare ANY income earned AND file a tax return for every year you have any form of income, even from barter, whether you end up owing any tax or not. This means a tax return every year you have any income. And if you should have had withholding and did NOT, OR failed to file a return for any year with income,  you MAY be liable for rather severe penalties. Your age does not exempt you from having to file a return because of earned income. This is complex and THAT is why you need a tax adviser to guide you through the maze congress has erected in your way. It irks me to NO end that I can NOT file my own taxes anymore because they have SO MANY rules and regulations designed specifically to trip you up and end up not only paying income tax, but fees and penalties for doing it wrong, even if you were innocent of any intentional wrongdoing. Just wait until you have a mortgage and own an active stock portfolio and then see what kind of headache you get from trying to do your own tax return  and NOT s***w it up in some manner...

Answer 3

Yes you can change your W-4 if you want.   You can claim exempt.

With the amount of money you are earning, the change will make almost no difference.  

You will not owe tax in any case.