You still can claim her as a dependent but she has to file her own return to report her self employment income, no matter how small. Be sure on her return she checks the box that says she can be claimed on someone else's return.
She may have to send in quarterly estimated payments. You must make quarterly estimated tax payments for the current tax year if both of the following apply:
- 1. You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits.
- 2. You expect your withholding and credits to be less than the smaller of:
90% of the tax to be shown on your current year’s tax return, or
100% of the tax shown on your prior year’s tax return. (Your prior year tax return must cover all 12 months).
She should set aside about 20% to cover self employment tax.
The 1040ES quarterly estimates are due April 18, June 15, Sept 15 and Jan 16, 2024. Your state will also have their own estimate forms.
Here are the blank Estimates and instructions…..
http://www.irs.gov/pub/irs-pdf/f1040es.pdf
Or you can pay directly on the IRS website https://www.irs.gov/payments
Be sure to pick the right kind of payment and year.....2023 Estimate
