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Although Social Security benefits are usually paid to adults, children who have a parent who is deceased, disabled or retired can also receive benefits. Typically, a child will not receive enough from Social Security benefits to pay income taxes, but if the child has additional sources of income, a portion of the benefits might be taxable. When determining whether a child’s benefits are taxable, you must consider the child’s income separately from your own. As of 2012, if one-half of your child’s benefits, plus any additional income, equal more than $25,000, your child must file a tax return.
Download Form 1040 and the form’s instructions from the Internal Revenue Service website.
Fill in the top portion of the form, which includes the child’s name, address and Social Security number. Check the box labeled “Single” in the Filing Status section of the form.
Leave both boxes blank in the Exemptions section because the child can be claimed as a dependent.
Enter the total amount of Social Security benefits received in the first box on the line labeled “Social Security Benefits.” As of 2012, this is line 20a on Form 1040. You can find the total amount in Box 5 on Form SSA-1099.
Complete the Social Security Benefits Worksheet located in the 1040 instructions. If the final amount calculated on the worksheet is zero, the child is not required to file taxes on the benefits. If the child had more than $5,950 of earned income or $950 in any other unearned income, he still has to file, but you do not have to include the Social Security benefits.
Transfer the taxable amount of Social Security benefits to the second field in the line labeled “Social Security Benefits” on Form 1040.
List any additional income in the “Income” section of Form 1040. This includes any other earned or unearned income.
Add all of the child’s income together and enter the total in the line labeled “Total Income.” Most children will not have any adjustments to claim, so transfer this amount to the “Adjusted Gross Income” line.
Complete the “Standard Deduction Worksheet for Dependents” in the Form 1040 instructions to determine the child’s standard deduction. As of 2012, this worksheet is located on page 34.
Enter the child’s standard deduction amount in the line labeled “Itemized Deductions or Standard Deduction.”
Subtract the standard deduction from the child’s adjusted gross income.
Use the tax table in the form’s instructions to determine the child’s tax. Match the child’s taxable income with the “Single” filing status. Write this number in the line labeled “Tax.”
Enter any income tax withheld, which is in Box 2 on Form W-2 or Box 4 on Form 1099. Taxes are usually not withheld from Social Security benefits. Skip this step if the benefits were the child’s only source of income.
Complete Form 1040 to determine how much the child owes in taxes. Mail the child’s tax return and payment to the address listed on the form’s instructions.
- Social Security Administration: Benefits for Children
- Internal Revenue Service: Publication 915
- Internal Revenue Service: In 2012 Many Tax Benefits Increase Due to Inflation Adjustments
- Internal Revenue Service: Publication 501 – Standard Deduction for Dependents
- Internal Revenue Service: Form W-2
- IRS: Form SSA-1099