Income Taxes for Children

If you're a parent, your child's taxable income is inherently linked to yours. In some cases, you may be able to include their income on your tax return. In other cases, they'll have to file their own tax return or you will have to file a separate return on their behalf. Depending on the level of your income, including their income on your tax return may result in higher income tax than if you prepare a separate return for your child.

Whether your child needs to file a tax return depends on a number of factors, including their age and the type of income that is being reported.

Earned and unearned income for a child

In general, your child must file a return if:

1. His or her unearned income (such as investment income from dividends or interest) was more than $1,250 for 2023.
2. His or her earned income (income from employment) was more than the standard deduction of $13,850 for 2023 and $14,600 for 2024.
3. He or she has net earnings from tips or self-employment that total $400 or more.

See IRS Publication 8814 and IRS Publication 8615 or your tax advisor for more information.

Age requirements

The above income amounts apply to any child who:

• Is age 18 or under on December 31 and whose earned income does not exceed half the annual expenses for the child's support, or
   
• Is a full-time student over 18 and under 24 on December 31 and whose earned income does not exceed half the annual expenses for the child's support.

What about a refund?

Even if your child isn't required to file a tax return, he or she should consider doing so if he or she is owed a refund.