Greetings,
Dependent child received minimal income for an internship done in 2024 summer @17yrs age. Once turned 18 (in Nov 24), used part of the money for cd/invest - which accrued some interest. I'm planning to file taxes for his full W2 (income earned at the age 17) and open may be an IRA for W2 amount. Is that fine?
Asking as part of that income used for cd. If above step is normal, do we also need to file separately for interest income or can we include all in one filing?
Thanks in advance.
If your son has income in 2024, you don't report your son's income on your tax return.
You can still claim him as a dependent if he didn't provide more than half of his own support for the year and he was under 19 at the end of 2024 (or under 24 and a full-time student).
As he has income from a form W-2, he can open a Traditional IRA and contribute a deductible amount up to $7,000 or his W-2 income, whichever is less.
The interest from the CD is reported on a form 1099-INT which has to be entered on his own tax return.
If it has to be reported, at all, it goes on his own return. If your dependent son is under age 19 (or under 24 and a full-time student), he must file a tax return for 2024 if he had any of the following:
If your dependent son files his own return, he has to indicate in the My Info section of TurboTax that he can be claimed as a dependent by another taxpayer.
Even if he had less, he can file if he needs to get back income tax withholding. He can't get back Social Security or Medicare tax withholding.
It is too late to make IRA contributions for 2022 and 2023.
Yes, if your son as enough earned income on his W-2 then you can open the IRA for him. Please see IRA contribution limits for additional information,
Please note, if the standard deduction reduces his taxable income to $0 then making a contributions to the traditional IRA won't benefit him and it would be better to make a Roth IRA contribution.
If your son has income in 2024, you don't report your son's income on your tax return.
You can still claim him as a dependent if he didn't provide more than half of his own support for the year and he was under 19 at the end of 2024 (or under 24 and a full-time student).
As he has income from a form W-2, he can open a Traditional IRA and contribute a deductible amount up to $7,000 or his W-2 income, whichever is less.
The interest from the CD is reported on a form 1099-INT which has to be entered on his own tax return.
If it has to be reported, at all, it goes on his own return. If your dependent son is under age 19 (or under 24 and a full-time student), he must file a tax return for 2024 if he had any of the following:
If your dependent son files his own return, he has to indicate in the My Info section of TurboTax that he can be claimed as a dependent by another taxpayer.
Even if he had less, he can file if he needs to get back income tax withholding. He can't get back Social Security or Medicare tax withholding.
Hi,
Thank you so much for your quick response. Much appreciated. So with filing taxes, can parent fund his IRA for the same amount and let him use his income (the way he prefers say CD, stocks)?
Additionally, if a minor has income in 2022,2023 that does not meet filing minimum, can that be filed now and open IRAs for the same now?
Thank you for your time.
It is too late to make IRA contributions for 2022 and 2023.
Yes, if your son as enough earned income on his W-2 then you can open the IRA for him. Please see IRA contribution limits for additional information,
Please note, if the standard deduction reduces his taxable income to $0 then making a contributions to the traditional IRA won't benefit him and it would be better to make a Roth IRA contribution.