1. Cut off the sleeves on the inside of the seam, so you're getting rid of the original seam of the t-shirt.
2. Leave about 1inch straps on both sides of the shirt, and then cut the neckline as shallow as possible. This means you'll be cutting as close to the original neckline as you can.
And just like any cuts you make on a t-shirt, make sure you stretch the fabric after. This makes it long, rolls the edges and creates a finished look, hiding any jagged cut lines.