Are Teenagers Exempt From Taxes on W-4 Forms in New Jersey?
The state of New Jersey imposes an income tax on teenagers in the same way it imposes tax on adults. If you have a job, your employer will require you to fill out a W-4 to estimate the amount of federal and New Jersey income tax to withhold from your paycheck. However, you may be exempt from submitting the form if your annual income is not subject to tax under certain circumstances.
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New Jersey Tax Requirements
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New Jersey allows each taxpayer to earn a maximum amount of income each year that is not subject to tax, and therefore, doesn't require the filing of a tax return. At the time of publication, a single teenager is exempt from paying New Jersey income tax if his gross earnings for the year are $10,000 or less. However, if you file as married and filing jointly or as head of household, the exempt amount doubles to $20,000 or less. When your income is below this threshold, you may also be exempt from New Jersey tax withholding.
NJ W-4 Withholding
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Teenage taxpayers in New Jersey must always submit a W-4 to their employers regardless of whether their income is exempt or not. You can use the federal Form W-4 for both state and federal withholding purposes, but if you claim different deductions and credits for New Jersey tax purposes, and want to report a different number of allowances on your W-4 for state withholding, you can fill out the state-specific form on NJ-W-4 in addition to the federal W-4.
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Keeping W-4 Current
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Every New Jersey taxpayer must provide each employer with a W-4 form at least once. If the number of allowances you claim doesn't change from year to year, your employer can use the same W-4 in future years for determining how much state income tax to withhold from your paychecks. However, teenagers who earn less than the income threshold for their filing status are eligible to exempt themselves from New Jersey tax withholding. However, to be exempt from withholding, you need to submit a new W-4 form each year and note the exemption. You can continue filing just one federal W-4 form if you are also exempt from federal income tax withholding. If not, you must submit the NJ-W-4 each year to remain exempt.
Federal Withholding Issues
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It is important to remember that your federal and New Jersey income tax obligations are separate, and being exempt from tax for one doesn't necessarily mean you are exempt for the other. The Internal Revenue Service has different filing thresholds for teenagers than the state of New Jersey. For example, if you file as a single taxpayer in 2011, you are only exempt from the income tax if you earn $9,500 or less during the year. If you file as exempt from withholding on one W-4 you should meet the exemption requirements for both.
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