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Hi guys, this is Noel Dalmacio, your ultimate CPA at lowermytaxnow.com
Do you have any summer job tax tip? Yes I do! If your child has a summer job, consider opening an IRA for your kid. If he has W-2 or earned income he can contribute to a regular or a Roth IRA. The regular IRA is tax deductible. However, since your child might have minimal income, the IRA deduction will result in smaller tax savings. Conversely, the Roth IRA is not tax deductible. However, the advantage of a Roth over a regular IRA is that withdrawals in retirement will be tax-free. That’s huge! We’re talking about tax-free income. Lastly, the contribution limit for both kinds of IRA for 2015 is the lesser of your child’s W-2/Earned income or $5,500.
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Until then. This is Noel Dalmacio, your ultimate CPA at lowermytaxnow.com - See more at: http://www.lowermytaxnow.com/summer-job-tax
Last Updated by Admin on 2015-08-19 11:44:48 AM