Guided 101 How Much Tax is Taken out of a Minor's Paycheck?

When a minor (under 18) starts working, the amount of tax taken out of their paycheck depends on several factors, including their income, the state they live in, and the type of job they have. Here's a general breakdown of the taxes that may be withheld from a minor's paycheck:

1. Federal Income Tax

• Withholding Requirements: Minors are subject to federal income tax just like adults. However, whether or not federal income tax is withheld depends on the minor’s income and whether they claim enough allowances on their W-4 form. If a minor claims "0" allowances, more tax will be withheld.
• Standard Deduction: For 2025, the standard deduction for a single filer (including minors) is expected to be around $13,850. If the minor earns less than this amount during the year, they may not owe any federal income tax, though some tax may still be withheld if their employer uses automatic withholding.

2. Social Security and Medicare Taxes (FICA)

• Social Security: Minors are subject to Social Security tax at a rate of 6.2% on their earnings.
• Medicare: Minors also have to pay Medicare tax at a rate of 1.45%.
• FICA withholdings are mandatory: Even if the minor is under 18, these taxes are generally withheld unless they are working for a parent-owned business or certain other exemptions apply (e.g., a student working for the school).

3. State Income Tax

• State income taxes vary widely. Some states, like Texas or Florida, don’t have a state income tax, so the minor would not have state income tax withheld. Other states, like California or New York, have state income tax, and the minor may have state income tax withheld.
• The withholding amount is determined by the state’s tax rates and the minor's total income.

4. Local Taxes

• Some cities or counties have local taxes that could be withheld from a minor's paycheck. This depends on the local tax laws in the area where the minor lives or works.

5. Other Deductions

• Unemployment Insurance: Depending on the state, a portion of the minor's paycheck may also be withheld for state unemployment insurance.
• Other benefits: Some jobs might offer benefits such as health insurance or retirement plans, which could result in additional deductions from the paycheck.

What Taxes Can Be Avoided?

• Federal Income Tax: If the minor earns below the standard deduction for the year, they may not owe federal income tax, although some tax could still be withheld. They can file a tax return to claim a refund.
• State Income Tax: Similar to federal taxes, if the minor’s income is below the state's threshold for taxable income, they may not owe state taxes.

Example Calculation:

Let’s say a minor earns $10,000 in a year and works in a state with no state income tax (e.g., Texas). Here’s an example of how the taxes might break down:

• Federal Income Tax: If the minor’s total income is below the standard deduction of $13,850, they might not owe federal taxes, though some withholding could occur.
• FICA: 6.2% for Social Security = $620, 1.45% for Medicare = $145. Total FICA = $765.

Steps for Minors:

• Fill out a W-4: The minor will need to complete a W-4 form for their employer, which helps determine how much tax should be withheld from their paycheck.
• File a tax return: If too much tax is withheld during the year, the minor can file a tax return to claim a refund.

Overall, a minor’s paycheck will have federal income tax (unless they claim enough exemptions), Social Security, and Medicare taxes withheld, and possibly state and local taxes, depending on the location. However, the amount of federal income tax can vary based on income and other factors.