How do I keep Turbo tax from generating self-imployment tax when I enter 1099-PATR information?

[tlfuchser]

When I enter the 1099-PATR information, the program calculated self-imployment tax.  Since this is income from an estate, there should be no self-imployment tax

[PattiF]

Form 1099-PATR is most often used to report dividends associated with farms, but there are other reasons that it can be issued. 

The form can be used to report:

• home mortgage from a land bank
• dividends from property purchased for personal use
• capital assets used in business
• gas from a local cooperative used for personal reasons

There are situations where the 1099-PATR does not have to be entered. 

To clarify the situation, do you know why this was issued to your brother?

[tlfuchser]

My brother passed away and he still had some unsold grain in a local co-op.  Once his account was closed, the sale of grain generated income to his estate/beneficiaries.  Since self-employment tax is related to social security benefits, taxing the sale of the grain doesn't seem appropriate in this case.  Trying to figure out if we can forego the SE tax in this situation.  If so, how do I keep TurboTax from calculating this tax.

Appreciate any help you can give me.

Thanks

[DianeW777]

Yes. You can enter the income differently and remove the Form-PATR from your return. This should not have self employment tax since it was issued through the estate and not for a self employed active individual.

To record and report this income on your individual tax return you can use the steps for other income.  

Please follow the instructions below to report Other Income:

1. Click Federal Taxes -> Wages & Income and scroll down to Less Common Income
2. Go to the last selection, Miscellaneous Income and click Start
3. Go to the last option, Other reportable income and click Start
4. When it asks, "Any other reportable income?" > yes and then type in a description and the amount to report it on your tax return.
5. TurboTax Online and TurboTax CD/Download will use the same procedure

Keep the Form 1099-PATR with your tax records should you need to provide information about your return later.