Q. Parents want to save taxes by paying me $25k out of their business account, Would they be able to take a itemized tax deduction via job expense?
A. Yes, if you actually did $25K worth of work. . It would be a straight (off the top) business deduction, not an itemized deduction. If they report it as wages, as opposed to issuing you a 1099-NEC, they would also pay (and get to deduct) the employer share of the FICA tax.
As others have said, in addition to income tax, you must pay social security and medicare tax on that income. It will be either FICA withholding on your W-2 (if you are paid wages) or you filing Schedule SE, as part of your income tax return, to pay it as "self employment tax" if you get a 1099-NEC.
There's some question as to whether the income should be reported as wages (W-2) or self employment. I'm of the opinion either way is OK.
Then there's the issue how does this payment affect your ability to draw unemployment compensation.
