Laws on Making Money While Underage

Discussion in 'Growing and Managing a Business' started by Brokenbuyer, Jun 25, 2011.

  1. Brokenbuyer

    Brokenbuyer
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    Basically, I write for websites. Now me and a partner sold a website and I will be getting ~$200 + ~$75/month. Will I have to worry about laws, taxes, or anything that will affect my financial aid/loan for college?

    Is there a certain amount that I can earn with reporting and such?
    I am in California and am close to under 18.
     
  2. GekiDan

    GekiDan
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    Welcome to Business Advice Forum Brokenbuyer! Thanks for posting your questions here.
    I don't think there's a law regarding that. Will you be making money online?
     
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  3. Joseph.Shivell

    Joseph.Shivell
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    I don't know about California state laws, but if you make over a certain amount per year, you do have to pay federal tax. Since you're only making $1100, you definitely haven't reached the threshold yet, but if you keep selling websites, you might want to look into it. According to the IRS website, If your filing status is "Single" and you are not claimed as a dependent, you must file a return if your income was over $9,350. If you are claimed as a dependent, you must file if your income was over $5,700.
     
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    #3 Joseph.Shivell, Jun 26, 2011
    Last edited: Jun 26, 2011
  4. Brokenbuyer

    Brokenbuyer
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    Thanks for the welcome!
    Yes it is online.

    So I'm still with my parents. Would they count as my dependents?
    At least for this year (and probably the next) I don't think I'll be hitting $5700 which seems to be the "safe" number for now.
     
  5. JBMedia

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    Brokenbuyer, in regards to your question, more than likely you'll need to talk to your parents about whether they claim you as a dependent when they file their taxes. In general, most parents do until their children have moved out, and some people do even after. More than likely if you were going to file a tax return for this year, you would be under the dependent area, so keep in mind of the $5,700 mark. Best advice though is to ask your parents to see if they do or do not claim you.
     
  6. Brokenbuyer

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    Yes I am a dependent.
    So $5700 a max per year? If I stay under $5700, I won't need to report anything and won't affect my financial aid?

    Most important is I don't want this to lower/disqualify me for financial aid for college and higher education.
     
  7. GekiDan

    GekiDan
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    So, you will be getting your money via Paypal, right? Is there really a need to report "everything" on the government?
     

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