Minor self employment tax and income

[Andy_W]

My 15yo son gets a regular, about $200/mon cash income from doing chores and yard work for neighbors.  He doesn't get a W2.

Is he considered self-employed by IRS and has "earned income"? 

What are the taxes he has to pay and how to pay his taxes (income, self-employed, ...etc)?

How to prove he has "earned income" so he can put some of that cash into a custodial Roth IRA account with him as the beneficiary?

[LeticiaF1]

Your son is considered to be self-employed and his income is considered earned income for IRA contribution requirements. Self-employed individuals must file a return if their income is $400 or more.  He must file a return and include his self-employment income in Schedule C.  He will be able to claim any expenses he had related to his work, like any supplies, tools, or mileage.  See the following TurboTax help articles to see more information:

Reporting Self-Employment Business Income and Deductions

What's the difference between a traditional IRA and a Roth?

[Andy_W]

Does my son have to pay social security and Medicare taxes, in addition to income tax?  How does he pay SS and Medicare taxes?

[CatinaT1]

Social Security and Medicare Taxes are what Self Employment Taxes are. He will pay income tax and self-employment tax on his net income.

[Bsch4477]

He probably won’t own income tax at his income level. TurboTax will calculate his self employment tax. 

[DawnC]

TurboTax will handle preparing the forms below.  He is considered self-employed, and his taxes are handled differently than if he were an employee of a company.

As a self-employed individual, you:

• Will pay self-employment tax (because income tax, Social Security, and Medicare aren’t deducted from your pay)
• Will get a 1099-MISC, 1099-NEC, or 1099-K (unless you only accept cash or personal checks)
• File a Schedule C, Form 1040 (this is how you report business expense or loss of income)
• Can deduct money you spent on work-related expenses (like mileage, home office expenses, and mobile phone use)
• Can estimate the taxes that are due and make quarterly estimated tax payments during the year

Get started by entering your income from self-employment.   We'll handle the rest, from creating the forms you need, to reviewing work-related expenses that can help reduce your taxes.