1099-Misc for dependent child?

Question

My 13yr old delivers papers once a week. She received a 1099-Misc. form and it shows her earnings in box 7 ($1094). This is her total earnings for the entire year and she has no unearned income. Does she have to file a return and a schedule C and pay SE tax since she is a dependant and her earned income is less than $5,150? She is a full time student and is hardly considered self-employed. Thanks in advance.

Answer 1

Unfortunately, yes she IS self-employed, 13 or not. The limit for filing is $400 of self-employment income, so she will have to file a C or C-EZ and SE, and pay self-employment taxes.

Update: OK, I learned something, which is one of the reasons I hang out here - thanks, spicertax. A newspaper carrier under 18 is NOT subject to the self-employment tax, so she won't need schedule SE - see http://www.irs.gov/faqs/faq-kw162.html

This does not exempt the income from income taxes, but her income is below the limit to have to file or pay taxes except for self employment tax, so the other responder is correct, she doesn't have to file. Check her 1099 to be sure that the income is in box 3 "other income" and not in box 7 "non-employee compensation"

Answer 2

There is a SE exemption for newspaper carriers under age 18. No 1040 is required either. See Schedule SE instructions.

Answer 3

Unfortunately, yes.

This is considered earned income subject to self-employment tax (Social Security).