First, under the Personal Income tab scroll down to Business Items and under that elect to start/update Business Income & Expenses (SCH C). You will see a business listed there (probably named "untitled") with a delete button next to it. Delete that SCH C. Do this first, or you *WILL* have major issues when you attempt to file your tax return. Once the SCH C is deleted, follow the below to enter your 1099-MISC correctly so that it's not treated as self-employment income.
Reporting 1099-MISC (box 3)
that is not self-employment income
Under the Wages & Income tab (or Personal Income tab)
scroll down to Other Common Income and elect to start/update Income from form
1099-MISC. Then click YES to indicate you have a 1099-MISC.
Enter the 1099-MISC exactly as printed, and then
Continue.
Enter the reason you got this money – be it scholarship,
bonus, streaking butt naked across the 50 yard line of the super bowl,
whatever. Then continue.
Select None of these apply, then Continue.
Select No, it didn’t involve work….. and Continue.
Select ONLY the tax year for which this specific
1099-MISC was issued. Do not select the year that you received the 1099. Select
the year for which the 1099-MISC was issued. Select no other year. Then
Continue.
Select No, it didn’t involve an intent to earn money,
then Continue.
Select NO, then Continue.
Click the DONE button, and that does it.
