Q: Do minors need to pay income tax?
I am a full-time student in high school. I've recently submitted some music to a music licensing company, and I am in the process of working out a contract with them. I am under the age of 16, and I believe I am claimed as a dependent on my parent's tax returns. According to the sample contract, I'm being 'hired' as an independent contractor. Do I need to pay income tax, and file tax returns, or will I be good simply setting the legal name on the contract to my parent's, and letting them claim my income as theirs' for taxation purposes?
A:
Yes, if you have $400 or more of self-employment income you'll need to file a 1040.
How much income you have will determine whether your parents can still claim you as a dependant.
There is a difference between royalties from music and Self-employed Independent contractor income so make sure the contract and the tax docs match. Also, the filing requirement for royalties is higher than for SE income. But you also have the kiddie tax to deal with if it's royalties.
This is a great time to find an attorney to work with that knows the music industry and tax or can refer you out to a return preparer, its an added cost but they can avoid a lot of headaches in the future.
Good luck.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
