I got a 1099 from my internship. How do I file taxes on it in 2025?

If you received a 1099-NEC from your internship, the company classified you as an independent contractor rather than an employee. This means you are responsible for self-employment tax and need to report the income on Schedule C.

How to report:

• Report the income on Schedule C (Profit or Loss From Business). Your business activity is your internship role.
• Deduct any legitimate business expenses (supplies, required software, travel to the job site if not your regular commute).
• Calculate self-employment tax on Schedule SE. The rate is 15.3% on net profit (12.4% Social Security + 2.9% Medicare). This is in addition to income tax.
• Deduct the employer-equivalent half of SE tax on Schedule 1, line 15.

Is the classification correct? Many employers incorrectly classify interns as independent contractors to avoid paying payroll taxes and providing benefits. If your employer controlled when, where, and how you worked, you may actually be an employee. You can file Form SS-8 asking the IRS to determine your worker status, or file Form 8919 to pay only the employee portion of payroll taxes if you believe you were misclassified.

Tax impact example: If you earned $5,000 from a 1099 internship, you owe approximately $765 in self-employment tax (15.3%) plus income tax on the remaining amount (reduced by the SE tax deduction). If you had been a W-2 employee, your employer would have paid half of that payroll tax.

Don't forget state taxes: Report the income on your state return as well. If the internship was in a different state than your home state, you may need to file in both states.