Filing taxes If under 18 in United States?

Question

If i made under $5150 online and am under 18 is it true I don't have to do anything regarding tax?

Answer 1

Whether you need to file depends on the type of income.  If it was gambling winnings, or wages, you do not have to file.  If it was from self-employment or investment income, you have to file.  

Self-employment income is filed using Schedule C.  You can deduct your expenses.  The net income is subject to Social Security and Medicare tax of approximately 15%.  At your level of income, you will owe no income tax.

Investment income of over $850 requires you to file a tax return.  You will owe tax if your investment income is greater than that.  Your parents can choose to include your dividends and interest on their tax return.

Answer 2

Most llikely not true.  It's true if they took out social security and medicare and gave you a W-2 - then the limit is $5350 for 2007, $5450 for 2008 if you are a dependent.

But if ss and medicare weren't taken out, you have to file if you made over $400, and while you won't owe income tax if $5150 was your entire income for the year, you will owe self-employment tax of around 14% for social security and medicare.

And by the way it has nothing to do with being under 18 - that doesn't change the tax liability.

Answer 3

Assuming that this income was from a job subject to withholding then that would be correct.  The limit for a dependent for 2007 was $5,350 and for 2008 it will be $5,450.  However if income tax was withheld from your pay you'd need to file to have that refunded to you.

On the other hand, if this was unearned income such as from dividends or interest or capital gains you are well above the $850 filing requirement amount.  And if it is self-employment income the filing requirement amount is only $400.

(Earned income is NEVER reported on your parents' return, although UNEARNED income can be.)

Answer 4

I think you report it with your parents earnings or you're not required at all to report it... Though I had heard that the limit was $4000 and not $5150. If your parents use an accountant, I would ask them the specifics--or see if anyone you know works for H&R Block, Pinnacle One, etc. They'll be able to tell you.