Too young to vote doesn’t necessarily mean too young to file a tax return. In fact, minors who have significant income often are required to file, says tax expert Abby Eisenkraft, EA.
Unfortunately, the answer to the obvious follow-up question—what is the minimum income to file taxes for a minor?—is the same as the answer to many tax questions. It’s complicated.
Here’s what parents need to know about whether their minor children must file, and the answer to the related question, “how long can I claim my child as a dependent?”
Whether a minor must file depends not only on the amount of income that he/she earned, but also the type of income. A minor must file his own tax return in 2024 if any of the following are true…
Earned income, such as wages reported on a W-2, exceeds the standard deduction amount, which in 2024 is $14,600.
Self-employment or tip income exceeds $400. Self-employment income includes “gig economy” income.
Unearned income, such as interest and dividends, exceeds $1,300. Exception: If a minor’s unearned income does not exceed $1,300, the parents typically have the option of either filing a return for the child or reporting the child’s income on the parents’ return by completing Form 8814, Parents’ Election To Report Child’s Interest and Dividends.
Gross income exceeds the larger of $1,300 unearned income or earned income (up to $14,150) plus $450. This rule means that a minor who has both earned and unearned income might have to file even if neither the child’s earned nor unearned income exceeds the filing requirement thresholds on its own.
Filing a return isn’t necessarily a negative for a minor. Most minors are in low tax brackets, and if money has been withheld from the minor’s wages, filing often results in a tax refund. In fact, minors who have had taxes withheld from their wages should strongly consider filing returns even if their income falls short of filing thresholds so they can claim the refunds they’re due.
Higher tax rates often apply to a child’s unearned income. For a child who has no earned income, the first $1,300 of unearned income is not taxed…the next $1,300 is taxed at the child’s tax rate…but any unearned income above $2,600 is taxed at either the child’s rate or the parent’s rate, whichever is higher. That rule is known as the “kiddie tax.”
For parents, the most important question is, How long can I claim my child as a dependent? To claim a child as a dependent, that child must be under the age of 19 at the end of the tax year…or at least age 19 and under the age of 24 at the end of the year and have been a full-time student (enrolled in the minimum number of credit hours the institution considers full-time for at least five months out of the year). These age limits are waived if the child is permanently and totally disabled.
For a parent to claim a child as a dependent, the child must not have provided more than half of his/her own support for the year. Example: A 16-year-old social-media influencer earns $100,000 during the year. If that 16-year-old uses some of his earnings to pay more than half of his living expenses, he does not qualify as a dependent…but if his earnings largely go into savings and his parents still pay most of his living expenses, his parents can claim him as a dependent despite his high earnings. For details, see the “Worksheet for Determining Support” in the instructions to IRS Form 501, Dependents, Standard Deduction, and Filing Information.
Keep in mind: The fact that a parent claims a minor as a dependent does not affect whether that minor is required to file his own return…nor does the minor filing a return preclude his parents from claiming him as a dependent.
