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If you’re hiring a student as an employee this summer, the best lesson you can give them is how the business world works. This lesson will go well beyond the summer they spend with you and might even help them understand the ways of the world. Here are 4 tips to help you teach your student employee:
- When you have your new student complete their W-4, explain to them that employers use this form to figure out how much federal income tax to withhold from worker’s paychecks.
- If the student is receiving tips as part of their income, encourage them to keep a daily log of their tips. If they collects more than $20 per month, explain that they must report that revenue to you, their employer.
- Doing odd jobs like babysitting or mowing lawns is considered self-employment and is subject to self-employment tax. Even if the student doesn’t make enough to pay taxes, they may have to pay Social Security and Medicare taxes, unless the student is under 18 years old.
- If the student is in ROTC, active duty pay is taxable; however, travel expenses such as food and lodging are not.
Lessons learned on the job are most likely remembered long after the classroom lectures! Take time to spend with your student employee this summer!