Is doing DoorDash considered a sole proprietorship?

[taxesx4]

Hi, 

My 19 year old son does DoorDash and has investment income from stocks he sold.  We live in California. Although he is a full-time student, we are NOT going to claim him as a dependent, because the benefits to us are phased out due to our income level.  He is filing a separate tax return because his income was about $14K.  He has a 1099-NEC from DoorDash.  We are checking the boxes:  "someone can claim me as a dependent", but "no one will claim me as a dependent in 2020"

I did have a couple of questions/confirmations:

1. I believe he is considered a sole proprietor and therefore TT is creating a Schedule C

2. He can legally claim the insurance paid on the car he drives for DoorDash (even though the car is not in his name)

3. He cannot claim his cell phone bill because he doesn't have a dedicated home office

4. TT says he qualifies for the "American Opportunity Credit" of $2500, even though we support him (we stated that he receives more than 50% of his support from someone else). Does that sound right?

Thank you!

[npierson7]

The best option would be for him to file as  independent, check the box No one can claim me as a dependent and claim his educational credit himself. He CAN claim his cell phone as business expenses for Door Dash business, even if he didn't have a home office; he still used it to communicate with customers. And yes, this income and expenses has to be reported on the Schedule C.

You can learn  what else can be deductible for him here:

Filing Tax Returns for Delivery Drivers: Tips and Advice

[pjlTTH31p]

Hi,

I have this same situation with my 20 year old son. He also earned about $14k, does door dash, is a full time student. He honestly does not support himself more than 50%, because tuition is paid from college funds. He only pays his car payment and car insurance himself. We do not HAVE to claim him, although the $2500 ATPC credit will cause us not to owe for the first time in 20 years. He wanted to claim himself, to be eligible for the stimulus rebates. I read on the IRS site that if he can be claimed by someone else, even though they don't claim him, he cannot claim himself. What is the difference between this scenario, and the original question asked. I would like my son to have the rebates, but I don't want to break the tax laws.

[taxesx4]

thank you for all the info. 🙂