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posted Jun 3, 2019 11:45:30 AM

My kid earned $1k babysitting, which qualified as household wages, i.e. no self-employment tax. She contributed the $1k to a Roth IRA. Does she need to file a tax return?

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1 Best answer
Level 15
Jun 3, 2019 11:45:31 AM

No.

But she may want to anyway, to document eligibility for the Roth IRA contribution, particularly if she was paid in cash and has no other accounting records for her earned income.

She is only a household employee if she baby sat in other people's homes and not her own.

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 continue the interview until it completes.

 TurboTax puts the amount on line 1 (wages) of form 1040 (line 7 prior to 2018) with the notation “HSH”. It is considered earned income.

On the other hand, you may not want to wave a red flag at the IRS. 

1 Replies
Level 15
Jun 3, 2019 11:45:31 AM

No.

But she may want to anyway, to document eligibility for the Roth IRA contribution, particularly if she was paid in cash and has no other accounting records for her earned income.

She is only a household employee if she baby sat in other people's homes and not her own.

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 continue the interview until it completes.

 TurboTax puts the amount on line 1 (wages) of form 1040 (line 7 prior to 2018) with the notation “HSH”. It is considered earned income.

On the other hand, you may not want to wave a red flag at the IRS.