By Jamie Waggoner
“How do taxes work if you’re emancipated?” Some children or teenagers have difficult family situations that lead to them declaring themselves independent from their family, i.e. emancipated, well how does that affect your taxes? You know, that is a very interesting question, I Googled it and it seems Google doesn’t even know.
And, if Google doesn’t even know, this must be serious!
This blog post will give you some things to consider when thinking about how your taxes will change if and when you decide to get emancipated…
Picture Credit: http://www.quickmeme.com/zach-galifianakis
What’s Your Income?
One question that emancipated youths wonder is whether they need to file their own taxes.
The first step to determining that is to see if you have income to report. The IRS tax filing requirements are (generally speaking) based on the amount and type of income you have. If you have taxable income over around $5,000, you may have a filing requirement.
What does your income look like, do you have a job, and how are you supporting yourself?
These are some questions to ask as you start thinking about taxes.
If you didn’t earn any money then there’s no tax return required (generally speaking).
Many emancipated youths are however working to support themselves at least partially so just depending what your income looks like, you may need to file your own tax return.
Next question would be:
Is there anyone else besides your parents helping you out?
Do you have any support other than your own?
If so, does the person supporting you claim you on their taxes or do your taxes for you?
These are all important questions to ask yourself because you can’t claim yourself as a dependent on your own taxes if someone else is already claiming you as a dependent on their taxes. So, if you have someone helping you, it’s best to coordinate that conversation ahead of time.
You also may run into an issue with your parents trying to claim you even though you’re emancipated. That’s a whole other can of worms. Emancipation often involves sticky situations and if multiple people are trying to claim you as a dependent that can cause an issue such as a letter from IRS to both people claiming you saying (in summary) “hey, you’re both claiming the same dependent, only one person should be claiming this dependent.”
What Does Your Emancipation Paperwork Say About Taxes?
Be sure to look over your paperwork after being emancipated; it may contain specific instructions about how tax matters will be handled.
Is there anything in your emancipation paperwork about taxes?
Taxes When You’re Emancipated – Conclusion
These are a few things to consider after being emancipated if you are concerned about taxes.
If you’ve chosen to emancipate yourself and you’ve read through this entire blog post, chances are you’re a pretty independent person, and you’re determined to make it on your own. Well guess what? The more you know about taxes, the better you’ll be able to take care of yourself financially, and not have to rely on others.
If that describes what you want out of life, consider jumping into the Pronto Tax School Basic Income Tax Course (it’s super-affordable and it’s all online). For sure you’ll learn a lot about taxes. You may even find a way to provide yourself with additional income as a professional tax preparer; no education other than what we provide in our course is required to be a tax preparer, and you can be a tax pro as young as 18 years old, even before then you may find work as a Tax Preparer Assistant.
About the writer:
Jamie Waggoner is a Communication Major at University of North Carolina-Wilmington (UNCW). Jamie’s favorite course at the moment is Integrated Marketing, which shows how smart companies use storytelling and word-of-mouth to develop authentic and compelling relationships with their customers and the general public. Jamie did not realize when she accepted an internship at Pronto Tax School that she would become a tax expert, but hey, life is full of surprises and that’s a good thing.