Now that school’s out, many students will (hopefully) be starting summer jobs. Here are a few things to share, about the reality of taxes, with your kids:

Withheld Income Tax. Students and teenage employees normally have taxes withheld from their paychecks by the employer. Most likely they had to fill out a Form W-4, which is used to calculate how much federal income tax to withhold from the employee’s pay.

Payroll taxes. This tax pays for benefits under the Social Security system. While taxpayers may earn too little from their summer job to owe income tax, employers usually must still withhold Social Security and Medicare taxes from their pay. If a taxpayer is self-employed, then Social Security and Medicare taxes may still be due and are generally paid by the taxpayer.

Self-employment. Students who do odd jobs over the summer to make extra cash – like baby-sitting or lawn care – are considered self-employed. They should remember that money earned from self-employment is taxable. Self-employed workers may be responsible for paying taxes directly to the IRS. Taxpayers who do this should keep good records of all money they receive.

Tip income. Someone working as a waiter or a valet receives tips as part of their summer income should know that tip income is taxable income and subject to federal income tax. They should keep a daily log to accurately report them, as they will report tips of $20 or more received in cash in any single month.