<p>Also, for "what do you expect to earn in the summer" question, I'm not sure what to put because I probably won't even have a job. It's 50-50 and it will probably be in cash as well. Thank you so much in advance!! </p>
<p>Why is the income off the books? How much is it?</p>
<p>If it’s not for certain, then put down zero. Whether it’s off the books or not, you are supposed to be reporting the money on federal forms for social security and other purposes. It’s illegal to do otherwise unless it’s baby sitting, law mowing type work. </p>
<p>Off the books I mean like paid by cash not by check. It’s only for a couple of hundred dollars and it is for tutoring my neighbor’s children. But they pay pretty competitively. </p>
<p>Whether it’s by cash or by check, it is supposed to be reportable to the IRS and social security is supposed to be paid on it if it is over a certain amount and if it does not meet exemption requirements. Given that it’s for a couple of hundred dollars and for child/care of sorts, it might be exempt. Look it up to be sure. But if you worked this summer and earned, say $10K, it wouldn’t matter if it was given to you via cash or check as to what the law says about reporting it to the IRS for income/social security and other taxes. Do research your situation. We are not a tax advice board. And yes, you are required to report the amount on your FAFSA whether or not you have to report it to the IRS. It won’t affect your FAFSA EFC, as the threshold of student earnings is around $6K or so before it affects the formula, don’t remember the exact amount.</p>
<p>The above poster is technically correct. I say hell NO!</p>
<p>It’s definitely below whatever the quota line is. Thank you for your help. </p>
<p>Also,where would you suggest me to research about the tax stuff? Do you have the link to certain websites that are helpful and easy to understand for a high schooler because I have no idea what the websites are talking about half the time. </p>
<p>Be aware that though it appears that you are below the TAX reporting threshhold, you still are supposed to be reporting that income on FAFSA and PROFILE. Doesn’t matter how little or by cash or check. They want to know all income. </p>
<p>Sunnydays, you need to get that info from the library, either at school or public. You need to look up what the tax reporting requirements are for children/dependents for IRS purposes. Then there are social security requirements for children as well. </p>
<p>Income is income, from dollar one. An employer doesn’t have to do the paperwork (W-2, withholding) until $400 ($600?) in a year to one person, but it is still income to you. It is up to you if you actually report it. Most people do not report small amounts that they didn’t keep track of - small lotto ticket wins, babysitting, selling something on ebay that the person made. Most do report these things once the money gets big, and again, it’s from dollar one so it’s not that you can tutor without reporting it up to $400 and then only report the amounts earned about $400.</p>
<p><a href=“Social Security: 5 Key Questions | Funding Your Retirement | Retirement Planning | Topics | 360 Degrees of Financial Literacy”>http://www.360financialliteracy.org/Topics/Retirement-Planning/Social-Security/Does-my-16-year-old-have-to-pay-Social-Security-tax-on-her-earnings</a></p>
<p>That gives you some perspective as to what has to be reported for social security purposes. There are also dollar amounts that one has to make per quarter before it has to be reported. Income below a certain threshhold does not have to reported to the IRS. My kids get w2s for their job even but last year did not earn enough so that they owed taxes so they did not have file tax returns. They had also filed an exemption from withholding so they did not have money coming back to them. Had they been working for cash in a capacity other than as household help or other such category that is exempted, they would have had to have paid social security on those earnings. That they were on a payroll that had that automatically withheld, that and Medicare premiums made it unnecessary for them to have to so report and pay to social security. </p>
<p>So you have several considerations for reporting. Reporting for IRS purposes. Reporting for social security purposes. And reporting for college financial aid (FAFSA, PROFILE) purposes. Different rules for each. For college financial aid, you are supposed to report ALL earnings. This is a forum for college financial aid, so that is all I want to address. You need to research the rest yourself and talk to someone who is a pro in that area. You should also double check all answers given here by reading the instruction on the FAFSA and PROFILE forms.</p>
<p>The tutoring income that you describe is in the Self-Employment category and, strictly speaking, you should be paying federal self-employment tax (social security, etc.) if that income exceeds $400/year after related business expenses. Here’s some information from the IRS:
<a href=“Self-Employment Tax (Social Security and Medicare Taxes) | Internal Revenue Service”>http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employment-Tax-Social-Security-and-Medicare-Taxes</a>
<a href=“Self-Employed Individuals Tax Center | Internal Revenue Service”>http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center</a></p>
<p>Truly, the forms aren’t that complicated. It is just a bunch of simple math with occasional doses of Algebra 1. Chances are you can complete them yourself.</p>
<p>Try the irs.gov website.</p>