18yr received 1099-misc, $2893 box 7. She paid $2200 for tuition. She can't claim the tuition because we claim her. How does she/us get credit for the tuition?

[trcmag]

How can her income be reduced to decrease the SET?  Can I put her income on my taxes and use the tuition deduction? If nothing else can I use the tuition deduction?  Her $409 tax bill seems high for her $2892 income.  Is there another way her employer can claim her income?

[MichaelL1 · Accepted solution]

Any expenses she has incurred in earning this income ($2,893) is a deductible expense per Internal Revenue Code 162, ordinary and necessary business expenses.

This is your only way to reduce this self-employment tax.

Moving the 1099Misc to your return is incorrect, and the SE Tax would be there anyway.  She cannot take education credits or deduction due to not being a dependent and some of the credits only apply to income tax and not SE Tax.  

The employers are very reluctant to change 1099Misc after the year of over.  For 2018, I would try to get a W-2 versus a 1099Misc to avoid the SE tax she is being hit up with, or put some money aside to pay this at year end, because it will be the same situation next year if another 1099Misc.

I would look for some expenses to reduce the SE tax, as that is the only thing I see that will help.