Recently, governments of many countries, mainly the majority, have become strict in maintaining a tax net. This is because of the falsely accused tax mafia and corruption charges often imposed on the countries. There are many other ways to drop these charges; however, most importantly, there is a way of bringing everyone into the tax net. Unfortunately, very few people are exempted from filing taxes and are required not to pay taxes.
Many teens enter the job market, whether as part of their graduate programs or their willingness to generate income at a very young age. However, they do not understand the consequences of what may happen if they do not file taxes on time. In addition, so many people do not know whether teens, such as those who fall in the age bracket of sixteen to seventeen, are exempted from filing taxes. In our previous article, you can learn how to calculate tax percentages from the total. In this article, we will write about age and how old you must be to file taxes.
How old do you have to be to file taxes?
All independent persons need to file taxes if their unearned income is over $1,100 or their earned income is over $12,400. However, if you are a child under age 19 or a full-time student under age 24 financially supported by parents, you do not file taxes.
Your children are dependent persons, and you can get a tax reduction if you answer all these questions with “Yes”:
- Are they related to you?
- Do they meet the age requirement (child under age 19 or a full-time student under age 24)?
- Do they live with you?
- Are you the only person claiming them?
- Do you financially support them?
In most cases, taxes are applied to the generated income throughout the year, and the income that is not earned is also added to the bracket. Therefore, a formula would generally be applied to understand the file returns. Most importantly, you will need the assistance of a particular person who is an expert in the field, such as a chartered accountant or financial manager.
There are many ways devised to file a tax. In most cases, even for adults, they shouldn’t file taxes on their own. This is because the game of numbers is sensitive, and people need to be very wary of their accounts so they do not commit any mistakes. One small mistake in filing taxes can lead to some staunch consequences; therefore, it is always advisable to take the help of a manager, notably an accountant or a financial manager with some experience in this business, to get the tax filing done. Similarly, if a child or those under the age of twenty need to file a tax, they must be aware that they should seek help from a finance professional. They should understand that filing taxes is not as easy as it sounds and has many complications.
At what age do you start paying taxes?
You start to pay taxes if you are older than 19, a student above 24, and your unearned income is over oveis1,100, or your earned income is over oveis12,400.
If the child is very young and not allowed to sign the tax papers, then ideally, their parents or any other legal guardian are bound to do so. In other cases, it is always advisable for the legal guardians to be involved in the process from the beginning until the end to know the steps. A transparent process should be followed, and the guardian must be made aware of any discrepancies. In contrast, those under twenty can independently fill out the required documents and submit them. Still, they should also ensure doing it by sitting with a legal guardian and a financial expert.
While filling out the application form, the legal guardian or parents must declare that the ones filing the taxes are their dependents. However, to claim their dependency on you, some conditions need to be fulfilled; for example, those claiming the child’s dependency should pay half of their expenses. They should also qualify as students studying full-time and must live in the same place as you for six months a year. Finally, looking at the age aspect of the child, for the child to qualify as your dependent, they must fall in the age group of nineteen to twenty-four years of age. If all of these criteria are met, they can only be called your dependent in the form.
Conclusion
In this article, we have discussed the different ways that children under twenty are bound to pay taxes as adults. The process can be followed by acquiring the help of experts, or they can also fill out the application on their own.
Parents or legal guardians can support and help the children and claim them as dependents if they qualify for conditions such as falling in the correct age group, being a full-time student, and living with them for half a year. If you fulfill these conditions, you can be given a tax file.
After leaving Wells Fargo Bank in 2014, Daniel began a career as a finance consultant, advising companies and individuals on economic policy, labor relations, and financial management.
At Promtfinance.com, Daniel writes about personal finance topics, value estimation, budgeting strategies, retirement planning, and portfolio diversification.
Read more on Daniel Smith's biography page.
Contact Daniel: daniel@promtfinance.com