There is an exception
to income from babysitting being subject to self-employment
tax.. You have "household employee" wages. If no single employer paid your more than $2000*, and you sat in their home**, not yours, you may be able to
avoid the self employment tax. But, you will also not get credit for these
wages with the Social Security Administration, for future benefits.
In TurboTax, enter at:
Federal Taxes
Click on Wages and Income
Scroll down to Less Common
Income
On Miscellaneous Income,
1099-A, 1099-C click the start button
On the next screen click the
start button on Other Income not already reported on Form W-2 or Form 1099
Answer Yes on the next screen
and enter the amount under Household Employee Wages
TurboTax will put the income on line 7 of form 1040 or 1040A with
the notation "HSH". It is still considered earned income
*You are not subject to self employment tax (SET) if you are under age
18 and made less than $6300.
**Otherwise, she is self employed and cannot avoid the self employment tax.
