Custodial IRA

[prbill]

My 13 YO granddaughter worked for me on my rentals.  She earned $390 & wants to open a Roth IRA.  I sent her a 1099 NEC.  This is earned income.  TurboTax says that she is not eligible for a Roth IRA.  I don't understand.

[VolvoGirl]

On her return did you fill out a Schedule C for the 390?   You have to have a Net Profit on Schedule C to count as earned income to contribute.   But since it's under $400 I don't know if that will count since she's not paying any self employment tax on it.   You don't pay self employment tax unless the Net Profit is over $433.