Big News: Your Child Started Working!

There’s nothing quite like that first paycheck. Whether your child is working part-time, full-time, or picking up seasonal jobs, it's a huge milestone — and it’s exciting for the whole family!

As parents and guardians, you might have a few questions popping up, like:

• Does my child need to file a tax return?

• Can I include my child’s W-2 income in my own return?

• At what point does my child have to file?

Good questions — and the IRS has clear rules depending on whether your child’s income is earned (like wages and tips) or unearned (like bank account interest or dividends). Here's a quick snapshot:

Income Thresholds for Filing Requirements

Income Type	Tax Year 2025	Tax Year 2024
Unearned Income (interest, dividends)	Over $1,350	Over $1,300
Earned Income (wages, tips)	Over $15,000	Over $14,600
Gross Income	More than the larger of: $1,350, or earned income (up to $14,550 + $450)	More than the larger of: $1,300, or earned income (up to $14,150 + $450)

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A Quick Example: A Teen with a Side Hustle

Let’s say your 17-year-old daughter worked part-time at a local café and also earned money babysitting and tutoring during 2025.

Here’s what she made:

• Café job (W-2 income): $6,800

• Babysitting and tutoring (self-employment

income): $2,900

• Savings account interest (unearned income): $100

• Total earned income: $9,700

• Total unearned income: $100

• Gross income: $9,800

Since her earned income is below the 2025 threshold of $15,000 and her unearned income is well below $1,350, she wouldn’t need to file based on those thresholds.

However, self-employment income over $400 means she must file a tax return due to self-employment tax obligations — even if she doesn’t owe regular income tax.

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An Exciting Door Just Opened

Now that your child has earned income, a whole new world of opportunity becomes available — including ways to grow that money tax-free for the rest of their lives.

In fact, your child (or you, on their behalf) could start putting money away that can someday help pay for college, a first home, or retirement — with incredible tax advantages along the way.

This strategy can create a head start... but it’s a topic that deserves its own full spotlight.

Stay tuned for an upcoming article where we'll break down how to make the most of this powerful opportunity!

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Have questions about your child’s taxes or financial future?

We’re here to help — send us an email, connect with us on social media, or schedule a time to meet at one of our offices!