How to report 1099 Misc Income of a dependent child 19 yrs old?

[sandippatel88]

As I read on internet, sounds like I don't have to show this 1099 Misc Income on my join return - but child has to file a separate return -- is that true for a 19 yr dependent child?

If yes, can I use TurboTax to create such return - transferring most of child's data???

I'm using TurboTax Deluxe CD on Windows

[VolvoGirl · Accepted solution]

Yes you do not report their income on your  return.  It only goes on their return.  That is true for any age dependent.  Even babies.  Be sure on their return they check the box that says they can be claimed on someone else's return.  That is very important!  So watch for it.  It is under Personal Info.

Yes you can use your Windows CD program.  Go up to FILE - NEW.  Be sure to save your return first with a name you can tell apart from the child's return.

What do you mean transferring most of the data?  You have to start a new return for them.  Nothing will transfer.  You can only transfer from a 2015 return, which I'm assuming they didn't file one last year.

[sandippatel88]

As I do further research....my daughter got a 1099-Misc Income for $1240 - there was no W4 withheld or anything.....my understanding is she is NOT required to file a return since income is less than $6300 and there is no Unearned income --- is this right?

[VolvoGirl]

No.  6,300 is only for W2 income.  For 1099Misc the amount is a lot less.  You have to file for $400 or more.  Even though she will not owe regular income tax on it (since it's less than 6,300) she owes self employment tax on it.

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment.  You pay 15.3% SE tax on 92.35% of your Net Profit greater than $400.  The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare.  So you get social security credit for it when you retire.  You do get to take off the 50% ER portion of the SE tax as an adjustment on line 27 of the 1040.  The SE tax is already included in your tax due or reduced your refund.  It is on the 1040 line 57.  The SE tax is in addition to your regular income tax on the net profit.