If minors earn income, the short answer is yes even if you claim them as dependents, but there are some choices you can make and some benefits to filing even when they have earned a small amount of income. If your child is old enough to understand the process, it’s the child’s responsibility to file a return. If your child is incapable of filing a return, the parent has the responsibility to file for the child. By signing on the child’s behalf, the parent also has the ability to discuss the return with the IRS if needed in the future.
The Internal Revenue Service requires all citizens to pay income tax if their gross income exceeds certain thresholds. For 2023, minors typically need to file for any earned income above $13,850. In 2024, this amount increases to $14,600. Earned income includes salaries and wages from an employer or through self-employment even if it’s a summer job or weekend gig. If your child has not exceeded the earnings threshold, it’s still a good idea to file because your child might be due a refund for withheld taxes.
If minors earn investment income, there are other choices to make. First, if the investment income exceeds $1,250 in 2023 or $1,300 for 2024, the income needs to be filed for the child. You can also report such income as part of your tax return if you claim the child as a dependent and the investment income consists of only interest and dividends by completing an IRS Form 8814 as an attachment to your personal tax return. However, if this addition pushes you into a higher tax bracket, you should consider filing the investment income under a separate return for your child.
