Minors and income tax

[hambirg]

What is the name of your state (only U.S. law)? WA

Quick question. . .if a 14yr old makes $700 refereeing softball games, is she required to file an income tax return? It's a friends daughter, and I'm not sure if she will receive a W-2 or 1099. The Mom believes no employer taxes were withheld. But my question is how can a 14yr old be an independent contractor when minors can't enter into contracts? Anywhoo. . .regardless, I have no idea what the tax laws are on this so TIA.

 

[davew128]

The income is taxable, a return is required, its subject to self employment tax, being a minor has nothing to do with the difference between being a contractor or employee.

 

[LdiJ]

The income is taxable, a return is required, its subject to self employment tax, being a minor has nothing to do with the difference between being a contractor or employee.

I agree. I will also add however, that if she gets a W2 instead of a 1099 (which appears unlikely) then she would not be required to file a federal tax return as her income would be less than her standard exemption, but she might still be required to file a state return.

 

[tranquility]

While some youth sports officials get a W-2, at least in CA, the general practices of the industry is to 1099. (Although, a few years ago the IRS did a lot of audits of paying organizations regarding this practice, most are careful to make sure the officials are not employees.)

Don't forget to include expenses!

 

[hambirg]

Ok. . thanks everyone. After reading the IRS employee or IC stuff, I really thought it would be difficult to classify her as a 1099 contractor. But seeing as the IRS has dealt with this in CA as a poster said above. . .ok then. I will pass this info along. Thanks.

Just as an aside. . .I did read some stuff from a university employment website saying that minors can't be IC's because they can't enter into contracts and can't waive liability. BUT I guess they are misinformed or probably just operating under CYA.

 

[davew128]

Just as an aside. . .I did read some stuff from a university employment website saying that minors can's be IC's because they can't enter into contracts and can't waive liability. BUT I guess they are misinformed or probably just operating under CYA.

None of which has anything to do with being an employee versus self employed. I stopped playing baseball three years ago, but there was never any doubt in my mind that the umpires were self employed (and likely not reporting the cash they got at home plate before the game).

 

[hambirg]

None of which has anything to do with being an employee versus self employed. I stopped playing baseball three years ago, but there was never any doubt in my mind that the umpires were self employed (and likely not reporting the cash they got at home plate before the game).

ok. . . thanks.