8 Tax Tips for Students with Summer Jobs +
Tax Items in Your Summer Wedding Checklist +
6 Tips to Help Pay Your Tax Bill this Summer
often get a job in the summer. If it's your first job it gives you a chance
to learn about work and paying tax.
The tax you pay supports your home town, your state and our nation.
Here are some tips students should know about summer jobs and taxes:
and Estimated Tax. If you are an employee, your employer withholds tax
from your paychecks. If you are self-employed, you may have to pay estimated
tax directly to the IRS on set dates during the year. This is how our
pay-as-you-go tax system works.
When you get a new job, you will need to fill out a Form W-4, Employee's
Withholding Allowance Certificate. Employers use it to figure how much
federal income tax to withhold from your pay. The IRS Withholding Calculator
tool on IRS.gov can help you fill out the form.
Money you earn doing work for others is taxable. Some work you do may count
as self-employment. These can be jobs like baby-sitting or lawn care. Keep
good records of your income and expenses related to your work. You may be
able to deduct (subtract) those costs from your income on your tax return. A
deduction can cut taxes.
All tip income is taxable. Keep a daily log to report them. You must report
$20 or more in cash tips in any one month to your employer. And you must
report all of your yearly tips on your tax return.
Taxes. You may earn too little from your summer job to owe income tax.
But your employer usually must withhold social security and Medicare taxes
from your pay. If you're self-employed, you may have to pay them yourself.
They count for your coverage under the Social Security system.
Carriers. Special rules apply to a newspaper carrier or distributor. If
you meet certain conditions, you are self-employed. If you do not meet those
conditions, and are under age 18, you may be exempt from social security and
If you're in ROTC, active duty pay, such as pay you get for summer camp, is
taxable. A subsistence allowance you get while in advanced training is not
Use IRS Free
File. You can prepare and e-file your tax return for free using IRS Free
File. It is only available on IRS.gov. You may not earn enough money to be
required to file a federal tax return. Even if that is true, you may still
want to file. For example, if your employer withheld income tax from your
pay, you will have to file a return to get a tax refund.
Include a Few
Tax Items in Your Summer Wedding Checklist
you’re preparing for summer nuptials, make sure you do some
tax planning as well. A few steps taken now can
make tax time easier next year.
Here are some tips from the IRS to help keep tax issues
that may arise from your marriage to a minimum:
of name. All the names and Social Security numbers on your
tax return must match your Social Security Administration
records. If you change your name, report it to the SSA. To do
that, file Form SS-5, Application for a Social Security Card.
The easiest way for you to get the form is to download and
print it on SSA.gov. You can also call SSA at 800-772-1213 to
order the form, or get it from your local SSA office.
tax withholding. When you get married, you should consider
a change of income tax withholding. To do that, give your
employer a new Form W-4, Employee's Withholding Allowance
Certificate. The withholding rate for married people is lower
than for those who are single. Some married people find that
they do not have enough tax withheld at the married rate. For
example, this can happen if you and your spouse both work. Use
the IRS Withholding Calculator tool at IRS.gov to help you
complete a new Form W-4. See Publication 505, Tax Withholding
and Estimated Tax, for more information. You can get IRS forms
and publications on IRS.gov/forms at any time.
in circumstances. If you receive advance payments of the
premium tax credit you should report changes in circumstances,
such as your marriage, to your Health Insurance Marketplace.
Other changes that you should report include a change in your
income or family size. Advance payments of the premium tax
credit provide financial assistance to help you pay for the
insurance you buy through the Health Insurance Marketplace.
Reporting changes in circumstances will allow the Marketplace
to adjust your advance credit payments. This adjustment will
help you avoid getting a smaller refund or owing money that
you did not expect to owe on your federal tax return.
of address. Let the IRS know if you move. To do that, file
Form 8822, Change of Address, with the IRS. You should also
notify the U.S. Postal Service. You can change your address
online at USPS.com, or report the change at your local post
in filing status. If you are married as of Dec. 31, that
is your marital status for the entire year for tax purposes.
You and your spouse can choose to file your federal tax return
jointly or separately each year. It is a good idea to figure
the tax both ways so you can choose the status that results in
the least tax.
Six Tips to Help You Pay Your Tax Bill this Summer
you get a tax bill from the IRS, don’t ignore it. The longer
you wait the more interest and penalties you will have to pay.
Here are six tips to help you pay your tax debt and avoid
Reply promptly. After tax season, the IRS typically sends
out millions of notices. Read it carefully and follow the
instructions. If you owe, the notice will tell you how much
and give you a due date. You should respond to the notice
promptly and pay the bill to avoid additional interest and
Pay online. Using an IRS electronic payment method to pay
your tax is quick, accurate and safe. You also get a record of
your payment. Options for electronic payments include:
- IRS Direct Pay.
- Electronic Federal Tax Payment System or EFTPS.
- Credit or debit card.
- Direct Pay and EFTPS are free services. If you pay by credit
or debit card, the payment processing company will charge a
Apply online to make payments. If you are not able to pay
your tax in full, you may apply for an installment agreement.
Most people and some small businesses can apply using the
Online Payment Agreement Application on IRS.gov. If you are
not able to apply online, or you prefer to do so in writing,
use Form 9465, Installment Agreement Request to apply. The
best way to get the form is on IRS.gov/forms. You can download
and print it at any time.
Check out a direct debit plan. A direct debit installment
agreement is the lower-cost hassle-free way to pay. The set-up
fee is less than half of the fee for other plans. The direct
debit fee is $52 instead of the regular fee of $120. With a
direct debit plan, you pay automatically from your bank
account on a day you set each month. There is no need for you
to write a check and make a trip to the post office. There are
no reminder notices from the IRS and no missed payments. For
more see the Payment Plans, Installment Agreements page on
Pay by check or money order. Make your check or money
order payable to the U.S. Treasury. Be sure to include:
- Your name, address and daytime phone number
- Your Social Security number or employer ID number for
- The tax period and related tax form, such as “2014 Form
- Mail it to the address listed on your notice. Do not send
cash in the mail.
Consider an Offer in Compromise. With an Offer in
Compromise, or OIC, you may be able to settle your tax debt
with the IRS for less than the full amount you owe. An OIC may
be an option if you are not able to pay your tax in full. It
may also apply if full payment will create a financial
hardship. Not everyone qualifies, so you should explore all
other ways to pay before submitting an OIC. To see if you may
qualify and what a reasonable offer might be, use the IRS
Offer in Compromise Pre-Qualifier tool.
Find out more about the IRS collection process on IRS.gov.
If you have comments or
questions on the information in these articles, as usual feel
free to call our offices at 480-838-7714.
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