My 18 year old received a 1099-Nec for work he did for another company. When filing taxes, it shows his income is $2,908 and the standard deduction is $3,146. He has a total deduction of $3.308 including self employment deduction of $162. It says he owes $323 in self employment tax. I'm trying to figure out how he owes anything when his total income was less than the standard deduction.
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Things work differently for self-employment income. If he had even $400 of self-employment income, he has to pay self-employment tax for Social Security and Medicare, even though he will not owe any ordinary income tax.
Since he is a dependent, his standard deduction is calculated differently, too, unless he earned as much as the single person's standard deduction of $13,850.
The standard deduction amount for an individual who may be claimed as a dependent by another taxpayer cannot exceed the greater of $1,250 or the sum of $400 and the individual’s earned income (not to exceed the regular standard deduction amount of $13,850).
You will need to use online Premium software or any version of the CD/download so that you can prepare a Schedule C for your business expenses.
https://ttlc.intuit.com/questions/2926899-how-does-my-side-job-affect-my-taxes
https://ttlc.intuit.com/community/self-employed/help/what-is-the-self-employment-tax/00/25922
https://ttlc.intuit.com/questions/2902389-why-am-i-paying-self-employment-tax
https://ttlc.intuit.com/questions/1901340-where-do-i-enter-schedule-c
https://ttlc.intuit.com/questions/3398950-what-self-employed-expenses-can-i-deduct
https://blog.turbotax.intuit.com/self-employed/self-employed-tax-deductions-
calculator-2021-2022-50907/
https://ttlc.intuit.com/questions/1901110-do-i-need-to-make-estimated-tax-payments-to-the-irs
https://turbotax.intuit.com/tax-tools/calculators/self-employed/
You might also want to use free software from the IRS Free File versions:
https://apps.irs.gov/app/freeFile/
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