Both your children are considered self-employed and have to file their own tax return as they have received more than $400 of self-employed income. The one getting $550 didn't receive a form 1099-NEC because it was less than $600, but he still has to report this income. The son receiving the form W-2 has to add it to his tax return.
If you claim them as your dependents, they have to indicate in their own returns that they can be claimed as a dependent by another taxpayer.
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