No. You should not report this a self-employment income because it is not.
If her total earnings were under the threshold of $15,750, she does not have to file, so that may be an option.
However, it may be beneficial for her to file, even if under that amount, for a potential refund, and to create a tax record. Therefore, here is another option to consider.
Instead, she can input this as a taxable scholarship by doing the following:
- Go to Deductions & Credits in the Federal section
- Select Education and click the drop-down arrow
- Select Expenses and Scholarships (Form 1098-T)
- "Did _ have any of these common situations in 2025?", select Received a scholarship, frant or other aid, Continue
- "Did_ get a 1098-T?", select No, then Continue
- Select "_qualifies for an exception", then Continue
- Enter the school info, leaving the payments for tuition blank, then Continue past the school info until you reach, Add any other financial aid
- Enter the amount of the funds received in the Other scholarships, grants, or fellowships box, Continue
- Check the "_ used it to pay for room and board" box when you reach, "Did _ have any of these situations for their scholarship or grant?"
- Enter the amount received as the amount used for room and board, then Continue
Following these steps ensures the stipend is correctly reported as taxable scholarship income used for room and board, which are considered non-qualified expenses. This will satisfy the IRS requirement to include it in earned income without incorrectly triggering self-employment tax.
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