This is important for your daughter.

worked on a research project during the summer, and was paid $5,600 (1099-Misc).

Your daughter will file her own tax return, and when she does so she must select the option for "I can be claimed on someone else's tax return".

What your daughter was paid is ***NOT*** self-employment income even though the income is reported in box 3 or 7 of the 1099-MISC. But because it's more than $400 *AND* is on a 1099-MISC, she is required to report it.

So that it does not get tagged as self-employment income (unless she wants to pay more taxes on it)  she needs to enter it as below in the TurboTax program.

Note to others: If you do this and the IRS determines it's self-employment income, your fines and penalties for filing a fraudulent return will be *HIGH*.

Reporting 1099-MISC (box 3 or box 7) that is not self-employment income

Under the Wages & Income tab (or Personal Income tab) scroll down to Other Common Income and elect to start/update Income from form 1099-MISC. Then click YES to indicate you have a 1099-MISC.

Enter the 1099-MISC exactly as printed, and then Continue.

Enter the reason you got this money – be it scholarship, bonus, streaking butt naked across the 50 yard line of the super bowl, whatever. Then continue.

Select None of these apply, then Continue.

Select No, it didn’t involve work….. and Continue.

Select ONLY the tax year for which this specific 1099-MISC was issued. Do not select the year that you received the 1099. Select the year for which the 1099-MISC was issued. Select no other year. Then Continue.

Select No, it didn’t involve an intent to earn money, then Continue.

Select NO, then Continue.

Click the DONE button, and that does it.