Do students need to file a tax return?
- Whether or not a student needs to file a tax return
depends on their income. If they earned more than $5,000 in income or
have interest income, a tax return is required.
- However, just because a student isn't required to complete
a tax return doesn't mean they shouldn't. If their income was less
than $5,000 but money was withheld from their paychecks, they should
file. It's very likely they'll get back most or all of what was
What counts as income?
The following forms of income count for students filling out a tax return:
- Any interest from financial institutions
- Income reported by employers on W-2 Forms
- Business income earned through freelance or entrepreneurial
- Some education grants, especially those used for other purposes,
such as room and board
- Income from work study programs
What forms should students use when filing their taxes?
- W-2: A W-2 is the United States federal tax
form issued by employers that states how much an employee was paid and
the amount of taxes withheld from their paychecks in the previous year.
The amount of taxes withheld is based on the withholding status
determined by the W-4 form that's filled out when an employee begins a
new job. An employee's withholding status takes into account marital
status, dependents, and whether or not the employee wishes to have more
than the standard amount withheld from each pay check.
- 1098-E: The 1098-E is a form filed with the
IRS that details the amount of interest paid on qualified student loans
during the previous year. Students may be able to deduct all or part of
the interest paid on qualified student loans, which could reduce the
amount they pay in income tax.
- 1040: The 1040 form is the standard IRS
form individuals use to file their annual income tax returns. Taxpayers
use this form to disclose their financial income status for the previous
year in order to determine whether additional taxes are owed, or whether
the taxpayer is due for a tax refund. IF their parents are claiming them
as a dependent, students may be entitled to a larger refund using the
standard 1040 tax forms.
- 1040-EZ: The 1040-EZ form is an alternative
to the 1040 income tax form and offers a faster, easier way to file taxes.
Its most often used by taxpayers with simple tax situations.
How should students file their tax return?
Students have a variety of options available to them when filing their tax return:
- In person: In addition to local accounting
firms, there are numerous tax preparation companies that advertise
during tax season. For a small fee, students have the opportunity to
work with a tax professional that will complete their income tax returns
and walk through the process with them. This may be beneficial for
first-time filers, or students with complicated financial situations.
- Online: Many tax preparation companies also
offer their services online. Some of these companies even allow for simple
forms, such as the 1040-EZ, to be filed without charge. This option is
great for students who want to file their own taxes quickly and cheaply.
- VITA: For students who want to tackle their
income tax returns on their own, there are still some safety nets available
to them. Many schools work with Volunteer Income Tax Assistance (VITA), a
national organization that offers free tax assistance for simple tax
questions and has many branches available on college campuses. If your
students have questions about their tax returns, find out if VITA is
available near you.
Tax season tips for your students (2014). Retrieved February 12, 2014, from