@Hal_Al wrote:
Anything in box 7 of a 1099-Misc is considered self employment income. Recipients with as little as $400 are required to file a tax return and pay "Self employment tax" (SET), even if no income tax is due. SET is how the "self employed" pay their social security and medicare tax.
An internship in many cases is not considered self-employment income since it is considered part of the student's education.
It is very clear that if the internship is at the school she attends, it is not self-employment income, and should be reported as "other taxable income" and not on schedule C.
I have it in my mind that this also applies to internships that are arranged with the school, and that are required as part of the student's degree program. But I can't find documentation of this in a short search.
If she went on her own and arranged a summer work experience that is not required by her school as part of her degree, it's probably not a qualified fellowship stipend and would be considered self-employment. It's also possible, depending on the nature of the work, that the company should have paid her on a W-2.
