1) If he worked for his college as an independent contractor, then he would be considered self employed even if he doesn't have an official business. This could be something along the lines of he was working in the IT department fixing computers in his spare time or doing maintenance when he was available or a variety of other things.
So if he did work and was considered an independent contractor, he would need to fill out a tax return because he made mor than $400 in self-employment income. This does NOT affect your ability to claim him.
2) No, he does not have to actually open a business. He is just considered self employed and will file a return using Schedule C. He will have to pay the 15.3% Self-Employment taxes on this income. All this says it he received income for doing work for someone who did not treat him as an employee so he has to pay the full amount of social security and medicare taxes.
3) No. You cannot include his 1099-NEC on your return, he must file his own.
4) Yes, he would still state that you will be claiming him. And you probably will have the $500 Other Dependent Credit for claiming him.
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