A nonemployee is an independent contractor for all intents and purposes. This means that she worked as her own business essentially and was not an employee of any business based on the reporting form and as you stated a 'nonemployee'.
The tax law is clear on two things:
- Independent Contractor (defined)
- Employees
If your daughter believes she should have been an employee she can argue that with the IRS and report her income on a substitute W-2 (Form 4852) which can be completed in TurboTax.
The Form SS-8 helps to differentiate between an employee and an independent contractor (self-employed). Take the time to review this form and decide if you have an employer/employee relationship. If the person in charge tells you when to be there, how to do your work and provides all the equipment necessary to do your work then it's quite likely this is an employer.
You are allowed to report the income as an employee if you believe that is the relationship you have, however, this will not go well with your employer. The IRS will go after them for payroll taxes which could mean penalties.
You can also continue to report your earnings as a self-employed independent contractor. To file like this you will need to use TurboTax Online Self-employed or TurboTax CD/Download Basic. The business name would be your name, the business address would be your address and the business code can be selected or you can use 999999, if you are not sure.
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