<p>I do happen to be a CPA and do tax work for a corporation. The only individual taxes I do are for my family, but I have several family members who are self-employed. I share the below with you from a personal and not a professional perspective (it’s been way too many years since I worked in public accounting).</p>
<p>Never assume you don’t owe taxes. Fill out the 1040 information on TurboTax (well worth it, as people have mentioned above). It will walk you through everything. </p>
<p>Also, I believe to get the new tax rebates from the economic stimulus package (just passed by Congress), one must file a tax return, even if nothing is due.</p>
<p>If they receive a W-2, it will include withholding, so you definitely need to file, if for no other reason than to get the withholding back as a refund. It’s very hard to take business expenses against W-2 earnings (see alldressedup above).</p>
<p>Earnings from a 1099 go on Schedule C, and this will probably require you to do a regular 1040 rather than a 1040 EZ. This is where you can take deductions and why you need to keep receipts. Deductions that easily come to mind could include fees to audition for summerstock work, headshot originals and duplicates, special dance clothes or shoes or any other costume requirement you pay for. You could consider taking a deduction for training, such as voice or dance, and for travel to auditions, but I usually have not done so (as I’ve been able to get his earnings low enough otherwise that he didn’t owe any taxes). </p>
<p>Be aware that earnings on Schedule C are also subject to a very hefty self-employment tax (both sides of FICA and medicare). This applies only over certain thresholds. If you use TurboTax , it will calculate all this for you.</p>
<p>A very important thing to remember is this - once you start earning enough money to actually owe taxes from 1099s and Schedule C’s, it’s very important to get tax advice and start paying in quarterly estimated payments for federal and state taxes. There are exceptions to underpayment penalties, so you will want advice.</p>
<p>In my mind, the goal for a college student is to find enough deductions to zero out their taxes!</p>