Teens & Taxes: What Documents Does Your Child Need to File Taxes?
It’s tax season once again! If you have a teen who started working for the first time in 2021, you could be facing new challenges and questions when it comes to filing taxes. Just as you want to make sure you have all your tax paperwork ready and waiting when you start to file, you’ll want to help your teen gather theirs.
See: Teens & Taxes: Quick Tips for First-Time Filers (and Their Parents)
Find: Truck Driving Teens Could Be the Answer to Supply Chain Issues
What paperwork will a teenager or young adult need to correctly file their tax returns?
Social Security Number or Tax ID Number (Note: They don’t need the actual card but it’s good to verify the number against the card for accuracy)
Home address
Bank account information (for payment or direct deposit)
1099-NEC forms (if they worked as an independent contractor)
W-2 forms (if they worked as an employee)
Any receipts or bank statements showing deductible work-related expenses
1099 forms showing income from investments or dividends
1098-T form showing income from college grants or scholarships
If you aren’t sure how your working child or teen is classified, it’s easy to find out. Check your teen’s pay stub; if withholding taxes were taken out for their job, they were a W-2 employee. They should have filled out a W-4 form when they began working.
You will find withholding taxes listed under three categories:
Federal income taxes
State taxes
FICA (Federal Insurance Contributions Act, which includes Social Security and Medicare taxes)
On the other hand, if your teen worked a gig or was an independent contractor, they will receive a 1099-NEC by January 31, 2022. The 1099 should indicate that no taxes were withheld from their pay.
See: IRS: Free File Now Open, Do Your Taxes For Free
Find: Tax Surprise! If You Received COVID Benefits, You Could See No Refund — or Even a Bill
Once you’ve gathered this information, you’ll want to help your teen file Form 1040 or 1040-EZ.
More from GOBankingRates:
GOBankingRates’ Best Banks of 2022: Live Richer by Banking Better
Easy Things You Can Do To Start Preparing for Retirement Now
This article originally appeared on GOBankingRates.com: Teens & Taxes: What Documents Does Your Child Need to File Taxes?