New and Confused!

[FrostedFlake570]

I'm 18 and a college student. My father is divorced and currently runs a small business. I however work somewhere else. I currently work as a manager somewhere and make over 12k. My father files taxes so when he does, he includes my income to the total household income. I understand my income is subject to federal and state which is already taken out from my paycheck. Is my now taxable income subject to both the household income tax rate along with the business tax rate or is the business tax rate just a separate thing for my father?

In addition, if I were to file my own taxes, would that save more money overall? If I were to file my own taxes, does that mean that he doesn't have to include my income to his household income? I do live with my father currently. 

[MargaretL]

Parents are not allowed to claim a child's wages on their tax return. I hope that he "includes" your amount to the household income for healthcare reasons and subsidy purposes but NOT to claim your wages as his income on his tax return... you may want to verify that. 

Having said that, since you are paid through a W-2, your wages are subject to a "regular" income tax rate (on your tax return, if you are required to file); you don't own a business and self-employment tax rate does not apply to you.

Your wages are completely separate and unrelated to your father business taxes.

If you are claimed as a dependent on your dad's tax return, please read Do I need to file my own taxes if I'm a dependent?  If you are not, please follow  Do I need to file a federal return this year? If you are not required to file, but your W-2 has federal and/or state withholdings, you may want to file to get that withholding back.