Seasonal Employment

With many teenagers starting summer jobs in a few weeks, it's important that have a basic understanding of how the tax code works.Uncle Sam will consider the majority of earnings made over the summer as taxable income, including bonuses and commissions. For those with a job waiting tables or other employment that includes tips from customers, those tips are also taxable income. Workers making more than $20 per month in tips, must report the amount to the employer so the taxes can be calculated and withheld. Tips either come in cash or added to the charge slip, workers and employers need to make sure both types are being recorded and calculated.According to the IRS, teenagers making money from self-employment such as mowing lawns, designing websites, or babysitting, must pay tax on those monies and will be required to file a tax return if the earnings exceed $400. It' not likely teenagers in this position will owe any income tax, but they will be required to pay self-employment tax, whi...

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