Teenagers and Taxes

Think the talk about the birds and the bees is tough? Try the one about teens and taxes. If your youngster had a summer job, does he or she have to file a tax return? It depends on how much was earned on the job and how much money your child earns from other investments.

Kids who are claimed as dependents on their parents’ returns are required to file if they earn more than $5,700 from a job in 2009. And they may be required to file a return even if they earned less than that from a job, if they earned more than $300 for the year from their investments (such as taxable income from a bank account, mutual fund or custodial account).

If they didn’t have a job, they must file a tax return if their investment income is more than $950 in 2009. For more information about the tax-filing rules for children, see IRS Publication 929.

Even if your child isn’t required to file a tax return, he or she may want to do it anyway to get back any income taxes withheld by the employer. That doesn’t apply to wages withheld for Social Security taxes — there’s no way to get that money back, until your child finally reaches retirement and claims the benefits.