If you received a Form 1099MISC then you worked as an independent contractor sometime last year.
The IRS considers independent contractors as business owners.
You will need to file your own tax return. If you’re a teenager you need to prepare a separate tax return from your parents.
Tell your parents not to panic, they can probably still claim you as a dependent!
Report the income from the 1099MISC on Schedule C Business Profit or Loss.
You may not owe federal income tax (if your total income is under $6,100 on 2013), but will owe self-employment tax at 15.3% of your net income.Ouch!
I cover this in detail in my ebook Teens and Taxes including an example with the forms filled out.
It’s worth the $3 to do it right. Buy a copy here.
And read this blog post from another parent whose son received a Form 1099MISC.
Carol Topp, CPA
P.S. If you think you should have been treated as an employee and not an independent contractor, you can complain to the IRS. I cover all that in the Teens and Taxes ebook. Here’s an excerpt.
