If $500 is your only income during the whole 2006, you will not need to pay any tax. However, you should file tax report (You will probobaly end up $0 taxable income after exemptions and standard deductions, etc. That’s why you don’t need to pay). School official will send you W2 or 1099 on Jan or Feb, 2007 to you for your tax report), if not contact them.