Tax Tips for Summer Jobs

By | April 13, 2014

Taxpayers in high school or college working summer jobs that occur only part of the year should consider several things related to taxes when they are working. Summer jobs are an opportunity for students to learn about the tax system. Let them know you will not take home all the money they earn because your employer must withhold taxes.


Here are six things the IRS wants students to keep in mind when starting a summer job.

  1. When you first start a new job you must complete a Form W-4, Withholding Certificate for Employee Permit. This form is used by employers to determine the amount of tax that will be withheld from your paycheck. If you have multiple summer jobs, make sure all your employers are holding you back an adequate amount of taxes to cover your total income tax obligation.
  2. Whether you’re working as a waiter or a camp counselor, you may receive tips as part of their summer income. All tips you receive are taxable income and therefore are subject to federal income tax. This must be reported on your tax return.
  3. Many students work in various temporary jobs during the summer to earn extra money. Earnings you receive from self-employment – including jobs like babysitting and mowing – are subject to income taxes.
  4. Although you do not earn enough money to pay taxes, probably have to pay self-employment taxes. The employer will withhold taxes from your paycheck. If you have net earnings of $ 400 or more from self-employment, you also have to pay taxes on self-employment. This tax pays for your benefits under the Social Security system that is available to people who are self-employed in the same manner that is available to employees who have taxes withheld from your pay. Taxes on self-employment is calculated on Form 1040, Schedule SE.
  5. The food and accommodation allowances paid to ROTC students participating in advanced training are not taxable. However, the pay for active enforcement – such as pay you received during a summer camp is taxable.
  1. Special rules apply to services you provide as a seller or paperboy. You are treated as self-employed for federal tax purposes if you meet the following conditions:
  • You are in the business of delivering newspapers.
  • All pay you receive for these services directly relates to sales rather than the number of hours worked.
  • You play service delivery under a written contract stating that you will not be treated as an employee for federal tax purposes.

If you do not meet these conditions below, and is under 18 generally is not subject to Social Security tax and Medicare. For more information on withholding tax and self-employment taxes visit the official IRS website at

Links about Form W-4

  • Form W-4 , Employee’s Withholding Allowance Certificate
  • Form 1040 , Schedule SE, Self-Employment Tax