What Is the Minimum Income to File Taxes for a Dependent in 2021?

The tax filing rules for an individual who can be claimed as a dependent differ from those for non-dependents. A dependent is typically a qualifying child or relative of the taxpayer, with criteria involving relationship, age, residency, and financial support. The core concept is that someone else, like a parent, provides for the individual.

Income thresholds for filing are adjusted for inflation annually, so taxpayers should refer to the rules for the specific tax year. The following information is based on the filing requirements for the 2024 tax year, the return filed in early 2025.

Defining Key Income Types for Tax Filing

To determine if a dependent needs to file a tax return, one must distinguish between different categories of income. The Internal Revenue Service (IRS) separates income into two types, which are combined to determine the total income that is compared against the filing thresholds.

Earned Income

Earned income includes all pay received for work performed, such as wages, salaries, tips, and professional fees. If a dependent worked a summer or part-time job, that compensation is considered earned income.

Unearned Income

Unearned income is money received from sources other than a job. Common examples include taxable interest from a savings account, dividends from stock investments, and capital gains from the sale of assets like stocks or bonds.

Gross Income

Gross income is the sum of all earned and unearned income before any deductions are taken. This is the final figure used to compare against the specific IRS filing thresholds to determine if a tax return is required.

Federal Filing Thresholds for Dependents

The IRS establishes specific income-based tests to determine if a dependent is required to file a federal income tax return. These rules are based on the type and amount of gross income the dependent received. The thresholds vary depending on whether the income was earned, unearned, or a combination of both.

A dependent with only unearned income is required to file a return if that income exceeded $1,300. For instance, if a child’s only income was $1,400 in stock dividends, a tax return is mandatory.

For a dependent with only earned income, a return is required if their earnings were more than $14,600. A teenager who earned $9,000 from a part-time job, for example, would not be required to file.

When a dependent has both earned and unearned income, they must file a return if their gross income was more than the larger of $1,300 or their total earned income plus $450. For example, consider a dependent with $600 of unearned interest income and $4,000 of earned wages. Their gross income is $4,600. The filing threshold is their earned income plus $450 ($4,450), which is larger than $1,300. Because their $4,600 gross income exceeds this threshold, they must file a return.

A separate rule applies to self-employment income. A dependent must file a tax return if they had net earnings from self-employment of at least $400. This applies to income from freelance work or operating a small business.

Reasons to File a Tax Return Even if Not Required

Even if a dependent’s income falls below the filing thresholds, it can be beneficial to file a tax return voluntarily. The primary reason is to receive a refund of withheld federal income tax from an employer, which is reported on Form W-2. If a dependent had taxes taken out of their paychecks, the only way to get this money back is to file a return and claim a refund.

Filing a return is also necessary for claiming certain tax credits. For example, a dependent student might be eligible to claim an education credit, such as the American Opportunity Tax Credit, under specific circumstances. Filing a return is the first step to determine eligibility and potentially receive a refund.