From fast-food restaurants to service stations to supermarkets to car wash establishments, high school students are seen working hard to earn some money for myriad reasons including to pay for college, help the family or simply have some cash to spend. The vast majority of high school students have yet to reach the age of majority. Under the law, they are minors and subject to the jurisdiction of parents or guardians.
Although this may seem to disqualify them as taxpayers, many can and do collect wages with taxes withheld. The best way to file taxes as a student is predicated on income, age and dependency status.
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Are High Schoolers Children Under the Law?
While 18 years of age is generally considered the legal threshold between childhood and adulthood, the law is not always so black and white. Criminal law agencies in several states have prosecuted 16- and 17-year-old offenders as adults in many instances. In terms of working, federal labor law allows anyone 14 or older to have a job but one must be at least 16 to work full-time. It is safe to say, then, that high school students can earn their own money and the government can take a piece of it.
How Many High Schoolers Work in the U.S.?
While teens don’t participate in the labor force as much as they used to, roughly one out of every three teens between 16-19 years old are employed, and that doesn’t count informal work where people work in family businesses and don’t receive a paycheck. This has changed.
Previously, more young students would work full-time and part-time jobs. Now, many don’t even work during the summer holiday season. There are a variety of reasons for the drop, but the biggest one would be that students don’t have much time for work after studying and extra-curricular activities.
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Is Filing Mandatory or Optional for Teens?
The rules applied to filing taxes for high school students turn on a few key factors. First is the matter of the standard deduction. For tax year 2021, the standard deduction is $12,550 for non-dependents but only $1,100 for those requiring parental support. If a student's annual wages fall below that figure, there is no need to file any return.
Another variable is whether the student is working as an employee or an independent contractor. If the latter, it does not matter how much was garnered during the tax year – the student is classified as self-employed so they must pay the self-employment tax that helps fund Social Security and Medicare.
Always Better to File
Since nothing is withheld from an independent vendor's pay, there is always something owed at tax time. That said, if the self-employed student is under 18, he or she bears no responsibility for either Social Security or Medicare. A newspaper carrier or distribution agent, then, is not responsible for filing.
One more qualification, investment income is taxable no matter what the age. If there is any question, it is always better to file.
Read More: Do High School Students Have to File a Tax Return?
How to File Taxes as Students
Most high school youths will use the standard 1040 form. Again, however, if working as an independent contractor, they must do some extra work and file with Schedule C attached to the 1040 form.
Earners of relatively low income can e-file for free on an IRS partner website. Hard copy forms are normally available at local public libraries if that is the preferable manner of filing. Online filing is usually faster, but the IRS is equipped to process either submission.
Adam Luehrs is a writer during the day and a voracious reader at night. He focuses mostly on finance writing and has a passion for real estate, credit card deals, and investing.