Instead of working this past year I babysat for my sister and she paid me. Do I need to file a return?

I also lived with them, so I no longer had to pay rent. Does this factor in the income taxes?Instead of working this past year I babysat for my sister and she paid me. Do I need to file a return?
Even if you earned money ';under the table';, you may still claim the income. It will be considered self-employment which uses many more forms and the simplicity of doing your taxes is a bit more complex. They may also deduct child care expenses, however there are special circumstances for employing someone who also lives in their home. Make positive that you have records for each party that are compatible.Instead of working this past year I babysat for my sister and she paid me. Do I need to file a return?
Did you pay taxes? Did she pay taxed for you and issue you a 1099? If you worked ';under the table'; then there is nothing to file because nothing was claimed.
Actually you are considered a household employee. Your sister should have withheld Social Security and Medicare taxes from your pay and paid payroll taxes on it using Schedule H on her return. If she paid you more than $8,750 under those circumstances then you'll have to file a tax return. The value of the housing isn't taxable as it appears to be a condition of employment for the benefit of your employer.





If she didn't withhold SS and Med taxes you'll have to file if she paid you more than $400 for the year as you must pay self-employment taxes at least.
I'd say you worked a lot. Babysitting is definitely WORK! Do you know if your sister is planning on claiming this as child care and taking a tax credit for it?





Your sister paid you, but you don't say whether or not she treated you as a household employee. This suggest you'll need to file a Sch C - Self-employed Business schedule. A single person can earn up to $8750 before owing any regular tax on their income. However, you'll owe self-employment taxes on all of this income at the rate of 15.3%





You say, ';I also lived with them, so I no longer had to pay rent.'; You don't state your age, but is it possible that your sister could claim you as a dependent? If so, then you can only earn up to $5350 before owing regular tax PLUS your self-employment tax.





You need to discuss this with your sister and find out how she plans on treating it on her income tax return.





Good Luck!


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