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New Member
posted Jun 1, 2019 1:41:49 AM

I got a letter from the IRS stating the income I reported on line 21, 1040, indicates that I may be liable for self-employment tax, & should do a Sch SE to determine tax

I may still owe.

0 2 1021
1 Best answer
Alumni
Jun 1, 2019 1:41:51 AM

I suspect you received a Form 1099-MISC with the amount paid you in Block 7. That means the issuer, either correctly or incorrectly, assumed it was self-employment income. They aren't always right.

TurboTax asks several questions to determine if this is self-employment income, or whether it is casual income not subject to self-employment tax. If, based on the answers, it is most likely not self-employment income it is not treated as such on your return.

Unfortunately, the IRS takes a "shoot first and ask questions later" position on whether it is self-employment income by making the assumption that the issuer's Form 1099-MISC is correct, not your tax return. That doesn't mean they are correct.

When you receive this type notice, all you can do is reply to the IRS explaining that it is one-time or casual income or receipts not subject to self-employment tax. See https://ttlc.intuit.com/questions/1899537


2 Replies
Alumni
Jun 1, 2019 1:41:51 AM

I suspect you received a Form 1099-MISC with the amount paid you in Block 7. That means the issuer, either correctly or incorrectly, assumed it was self-employment income. They aren't always right.

TurboTax asks several questions to determine if this is self-employment income, or whether it is casual income not subject to self-employment tax. If, based on the answers, it is most likely not self-employment income it is not treated as such on your return.

Unfortunately, the IRS takes a "shoot first and ask questions later" position on whether it is self-employment income by making the assumption that the issuer's Form 1099-MISC is correct, not your tax return. That doesn't mean they are correct.

When you receive this type notice, all you can do is reply to the IRS explaining that it is one-time or casual income or receipts not subject to self-employment tax. See https://ttlc.intuit.com/questions/1899537


New Member
Jun 1, 2019 1:41:53 AM

I do consultant work on the side for attorneys, and they finally paid me money owed to me for cases I started working on in prior years.  I did not receive a Form 1099-MISC, they just paid me the checks.