So… your teen wants to become more responsible and get a part time job, they want to help take the load of you by paying their cell phone bill and purchasing those expensive sneakers that seem to come out in every color. Many parents are happy to hear that their child is willing to work to get what they want and working teaches them responsibility.
During tax time, many parents would come to the office misinformed and say, “I can’t claim him/her anymore because their working,” or ask, “Is it true you can’t claim your child anymore once they start working?” The answer is No, it’s not true. Not only can you still claim your teenager, they can file a tax return as well.
Even though your teenager has earned income, they are still your dependent. The rule is if you supply more than half of their support and they’ve lived with you for more than half the year then they are still yours to claim. Now, if you’re a parent of a child superstar that’s a different story because more than likely their supporting you.
Your tax refund will not be affected because your teen has a job, in fact your teen can file a tax return on the income and taxes they accessed throughout the year. However, the teenager loses their exemption, deductions or credits because you have already taken them on your return, so no double dipping here. Almost always, the teen’s refund is exactly what they paid in taxes throughout the year.
Although many teens would like to file their own tax return and not have their parents claim them, when coming to our office we advised them that if they are essays captain still getting more than half of their support from their parents then it should be the parents to receive the credits and deductions on their behalf. It will be more beneficial, deductions, credits and refund wise for them to be claimed as opposed to them filing an independent tax return.
If you have any questions regarding this or any tax related subject matter, please feel free to inbox one of our Tax Practitioners
by Enoch St. Clair
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