You will not include that income on your tax return. It will be filed on your child's tax return. If that's her only income, she is not be required to file. If she does,however, she will get a refund for the tax that was withheld. Just make sure that when she files, she answers yes to the two questions in Turbo Tax to indicate that someone else can claim her as a dependent. The questions are found on the first page of the tax return. Please see my screenshot below.