Varley Law Office PLC

Varley Law Office PLC
201 NE 2nd ST, Stuart, Iowa 50250; (515) 523-2456

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Monday, June 04, 2018

Tips for teenage taxpayers starting a summer job 


Adapted from IRS Tax Tip 2018-82 

Now that school’s out, many students will be starting summer jobs…from working at a summer camp to being an office intern. Here are a few things the IRS wants these workers to know when starting a summer job:  

  • New employee? Students and teenage employees normally have taxes withheld from their paychecks by the employer. Each new employee fills out a Form W-4. The employer uses the W-4 to calculate how much federal income tax to withhold from the employee’s pay. The IRS Withholding Calculator can help a taxpayer fill out this form.
  • Self-employment. Students who do odd jobs over the summer, like baby-sitting or lawn care, are considered self-employed. Money earned from self-employment is taxable. Workers who are self-employed may be responsible for paying taxes directly to the IRS. One way to do that is by making estimated tax payments during the year. Keep good records of all money received and paid.
  • Tip income. A waiter or camp counselor or anyone who receives tips should know that tip income is subject to federal income tax. Keep an accurate daily log and report tips of > $20 received in cash in any single month.
  • Payroll taxes. This tax pays for benefits under the Social Security system. While taxpayers may earn too little from their summer jobs to owe income tax, employers usually must still withhold Social Security and Medicare taxes from their pay. If a taxpayer is self-employed, then Social Security and Medicare taxes may still be due and are generally paid by the taxpayer.
  • Reserve Officers' Training Corps. If a taxpayer is in an ROTC program, active duty pay, such as pay for summer advanced camp, is taxable. Other allowances the taxpayer may receive – like food and lodging allowances paid to ROTC students participating in advanced training - may not be taxable. The Armed Forces' Tax Guide on IRS.gov has more details.
IRS YouTube Videos:
Part-Time and Summer Jobs