This is really helpful! I'm actually in a pretty similar situation as OP - just started a part-time job while in college and my parents are claiming me as a dependent. Quick question though - you mentioned that you may still need to file a tax return depending on your total income situation. Since OP would have $1,900 in income, would they actually be required to file a return even if they claim exempt and have no federal tax withheld?

@d9a6085234fe Good question! For 2025, if you're claimed as a dependent and only have earned income (wages), you're generally required to file if your earned income exceeds $1,300. Since OP would have $1,900, they would technically be required to file a return even if no federal tax was withheld. However, if they claim exempt and have no federal tax withheld, they wouldn't owe any tax and wouldn't get a refund - the return would basically just be reporting their income to satisfy the filing requirement. If they had any federal tax withheld (by claiming 0 instead of exempt), then filing would get them that money back as a refund. So yes, OP would need to file regardless, but claiming exempt just means they get their full pay upfront instead of lending money to the government interest-free until filing season.

That's a really good point about the timing! I hadn't thought about how with only 2-3 paychecks, even a small withholding amount could make a noticeable difference in each check. Getting like $50-75 more per paycheck (whatever the federal withholding would be) is probably way more useful right now than waiting until next April to get back maybe $150 total. Plus dealing with filing just to get back such a small amount seems like more hassle than it's worth.

Do you happen to know if the income limit is based on what you make for the full year or just during the time you're on the marketplace plan?

The income limit for marketplace subsidies is based on your projected annual income for the entire year, not just the months you have marketplace coverage. So if you're unemployed for part of the year but then get a high-paying job, your total annual income could push you above the subsidy threshold even if you were only on the marketplace plan while unemployed. That's exactly why @Lola Perez had to pay back subsidies - it s'a really common mistake people make! You re'supposed to report income changes within 30 days to avoid owing money back at tax time.

This is really helpful advice! I didn't know COBRA could be applied retroactively - that's actually a huge relief to know. I'm in a similar situation right now where I'm between jobs and trying to decide if it's worth paying for COBRA or just going without coverage for a few months. The retroactive option makes it seem like less of a gamble. Do you know how long you have to elect COBRA coverage after losing your job? And does the retroactive coverage work even if you wait until after a medical incident to elect it?

@Ravi Malhotra You typically have 60 days from the date you lose your job-based health coverage to elect COBRA. And yes, the retroactive coverage works even if you wait - as long as you re'still within that 60-day window, you can elect COBRA after a medical incident and it will cover expenses back to the day after your original coverage ended. You ll'need to pay all the back premiums though, not just from when you elected it. It s'basically like having an insurance safety net during that 60-day period. Just keep in mind that COBRA can be pretty expensive since you re'paying the full premium what (you and your employer used to split plus) a 2% administrative fee.

You still technically need to report ANY income on your taxes, even if it's small and even if you don't get a 1099 form. The IRS requires reporting all income regardless of amount.

This is super helpful, thank you! I'm also just starting as a campus ambassador and was totally overwhelmed by the W9. One quick question - when you mention keeping track of phone bill expenses, do you mean like if I use my phone to post about the brand on social media? How do you even calculate what portion of your phone bill counts as a business expense?

Wait really? I've been reporting my Roth contributions on my tax return every year. Have I been doing this wrong? I use TurboTax and it always asks about IRA contributions.

You're not doing anything wrong! TurboTax asks about IRA contributions because it needs to distinguish between traditional IRA contributions (which are deductible) and Roth IRA contributions (which aren't). When you enter your Roth contributions, the software uses that information to calculate things like the Saver's Credit if you're eligible, but it doesn't actually reduce your taxable income since Roth contributions are made with after-tax dollars. So you should keep reporting them - the software just handles them differently than traditional IRA contributions.

This is such great advice about keeping records for contribution basis! I never thought about needing to prove contributions vs earnings for early withdrawals. Do you know if there's a specific way the IRS wants these records organized, or is just keeping the annual 5498 forms enough? I'm pretty good about filing tax documents but want to make sure I'm doing this right for the long term.

That's really interesting - I hadn't even considered that possibility. She does only work through this one coordinator who tells her exactly when to show up, what to wear, and even provides a specific set list for each event. The coordinator also handles all client interactions and payments. Would those factors suggest she should be an employee?

Those factors definitely suggest she might be misclassified! When the business controls the when, where, and how of the work, that strongly indicates an employment relationship rather than independent contractor status. Other indicators include if they provide equipment (though you mentioned venues have the pianos), if she can't work for competitors, and if she's economically dependent on this one business. If misclassified, filing Form SS-8 with the IRS would request a determination of worker status. She could also file Form 8919 to report her share of uncollected Social Security and Medicare taxes. This would potentially reduce her tax burden since she'd only be responsible for the employee portion (7.65%) rather than the full self-employment tax (15.3%).

Unfortunately, you do have to file Schedule SE if your net earnings from self-employment are $400 or more. There's no legal way to "skip" the self-employment tax as it funds your future Social Security and Medicare benefits. However, you can potentially reduce your self-employment income by making sure you're claiming all legitimate business deductions on Schedule C first. Things like your computer, portion of internet/phone, home office, software subscriptions, and professional development can all reduce your net profit subject to SE tax.

Thanks for the honest answer. Guess I just needed someone to confirm I can't avoid it. I'll look into those deductions for sure. Do you know if the SE tax is calculated before or after regular income tax? Just trying to understand the full picture of what I'm paying.