When Does a Teenager Have to File a Tax Return?

by Kristine Tucker

A teenager files a tax return when his income exceeds Internal Revenue Service (IRS) income limits even if he is claimed as an unmarried dependent on his parent's tax return. If the teenager is self-employed, income exceeding IRS guidelines is also taxable, and he must file a return. Income includes both earned and unearned income, including wages, tips, taxable scholarships and investment income.

Unearned Income

According to the University of California Cooperative Extension, a teenager must file a tax return if her unearned income exceeds $950 in a calendar year as of 2010. Unearned income includes interest and dividends from investment income, including stocks, securities, savings accounts and money market accounts. Cash gifts from relatives is not considered unearned income and is not taxable.

Earned Income

IRS guidelines as of 2010 require a teenager to file a tax return if his earned income exceeds $5,700 in a calendar year. Earned income includes employment wages and tips. All tips are reported as income even if the employer does not report tips. Taxable scholarships, grants and academic fellowships are also considered earned income. If the teen's earned income does not exceed $5,700 but his employer withholds taxes on his behalf, he should still file a tax return because he's eligible to receive a refund for all or a portion of the taxes withheld.

Gross Income

The University of California Cooperative Extension reported that in 2010, a teenager was required to file a federal tax return if her gross income, including both earned and unearned income, was the larger of $950 in unearned income or $5,700 in earned income. Gross income is the amount of income earned before deductions.

Self-Employed Income

In 2010, the IRS required a teenager to file a tax return if he was self-employed and earned more than $400 in profit from his work. Some specific examples of self-employment income include babysitting, mowing lawns and selling items on online auction sites. If the teenager is self-employed, he completes a Schedule SE when filing a federal tax return, which allows him to deduct expenses associated with his income.

About the Author

As curriculum developer and educator, Kristine Tucker has enjoyed the plethora of English assignments she's read (and graded!) over the years. Her experiences as vice-president of an energy consulting firm have given her the opportunity to explore business writing and HR. Tucker has a BA and holds Ohio teaching credentials.

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