How much does a dependent need to make a year to have to report taxes?

[jyeh74]

Let's say a dependent child makes money doing chores for their parents at home.  The parent will pay their child cash or just deposit it into the kid's bank account.  How much do they have to make a year in order to be forced to report it?  

My understanding is $12,400 a year as a dependent minor, under 18 years.

I got this link

ttlc.intuit.com/community/retirement/discussion/re-funding-a-custodial-roth-ira-for-children/01/2017...

When a dependent (child or adult) may need to file a tax return

Taxpayers who are claimed as a dependent on someone's tax return are subject to different IRS filing requirements, regardless of whether they are children or adults. A tax return is necessary when their earned income is more than their standard deduction.

The standard deduction for single dependents who are under age 65 and not blind is the greater of:

• $1,100 in 2020
• Or the sum of $350 + the person's earned income, up to the standard deduction for an unclaimed single taxpayer which is $12,400 in 2020.

A dependent's income can be "unearned" when it comes from sources such as dividends and interest. When a dependent's unearned income is greater than $1,100 in 2020, the dependent must file a tax return.

[DaveF1006]

You may first try to file a kiddie tax return according to the instructions in this Turbo Tax link.  If you are unable to file, then your child can file their own tax return but state that they are a dependent of someone else. According to the link:

1. Open or continue your return if you don't already have it open.
2. Search for child income and select the Jump to link in the search results.
3. Answer Yes to both Any Child's Income? and Child Required to File?
4. Select Continue on the Reporting Your Child's Income screen.
5. We'll ask you a series of questions to determine if the income can be included on your return or if your child needs to file their own return.

[Edited 03-02-2021|06:57 PM PST]

[jyeh74]

@DaveF1006  I’m not sure I follow you.  I thought you only need to file a tax return only if your earned income is GREATER than $12,400 per year? Any earned income less than $12,400 per year does not require you to file taxes.

The link you sent me is for unearned investment income. 

[DaveF1006]

After reading your post, your child does not need to file unless they wish to receive money back from income taxes that may be been withheld. If they are working for you, they do not need to file unless they have unearned income greater than $1100. 

[fanfare]

I don't believe an allowance is considered income.

In any case no kid in his right mind would ever report their allowance to the IRS.

[DaveF1006]

@jyeh74   I have exhaustively searched and please review this IRS  link  that should fully answer your question. 

Employment tax requirements for family employees may vary from those that apply to other employees. The following information may assist you with pointing out some differences to consider.