Glendale Taxes | Summer Jobs
Many students will spend their summer by not only having fun, but by getting a job to earn some extra money. If it’s the students first job, the job gives them an opportunity to learn about work, paying taxes and budgeting their spending money. Here are some tips that students should keep in mind about summer jobs and income taxes.
- If you are an employee, your employer will withhold income taxes from your paycheck. This money will be applied to your income tax liability on your tax return. If you are self-employed, you might be responsible to pay estimated tax on your income directly to the IRS. These estimates will be due on certain dates throughout the year. These estimated payments will lower your tax due on your income tax return. This is how our “pay as you go” tax system works.
- When you get a new job, you will need to fill out a new form W-4 so your employer will know how much income tax to withhold on your paychecks.
- Some summer jobs that you perform for people will be considered self-employment income. These jobs can be like baby sitting or lawn care. Keep a detailed record of all of your income and expenses. You will use this information to fill out your tax return,
- Tip income is always taxable. Keep a daily detailed log of all your tips that you receive. You must report $20 or more in tips in one month to your employer.
- You might not earn enough income to have a tax liability at the end of the year. Your employer must still withhold social security and medicare taxes from your paychecks though. Self employed individuals might be responsible for them on their own.
If you have any questions, feel free to contact us at Dusseau & Makris, PC, your Phoenix CPA firm.