It depends. To clarify, what is it you are trying to enter. You will need to do this in the program because Schedule 1 does not allow you to enter anything directly on the form
Thanks for the response! I received a 1099-K for PayPal withdrawals (really just a return of capital and not net taxable income). I want to report the 1099-K amount on my return so that it doesn't raise any red flags with the IRS, but it's not really net income, so I was trying to think of the best way to report it as gross income but then cancel it out. My best guess was to put "Gross PayPal Receipts" on Schedule 1, Line 8z. And then "Gross PayPal Disbursements" on Schedule 1, Line 24z. I found out where to enter amounts on Schedule 1, Line 8z, but as far as I can tell there is no way to enter amounts on Schedule, Line 24z.
To enter:
Why is there no direct entry into line 24z, the intent of this line was to reduce any type of "misc income" such as 1099-K for personal sales. Doing a negative 1099K adjustment in line 8 is not a good solution. Intuit should create a supporting statement and data input into line 24z or remove it.
Depending on what type of personal sales and whether you made a profit determines the location of the income entry. For sales of personal use and/or type of property, it should be entered as an investment sale. Any sale of personal use property that may result in a loss is not required to be reported because personal losses are not deductible.
To enter a sale of personal use property for sales at a gain follow the instructions below. Otherwise follow the instructions provided by @DaveF1006 for Other Income.
Once you have your information you will complete the entry in TurboTax using the following steps.
The 1099k reported from paypal for personal property sales needs to have an adjustment. You are correct the personal property sales should not be taxable but including them as investment sales is not accurate also.
The best option would be to provide an adjustment for 1099K transactions deemed to be non taxable as they were personal items sold out of a garage using an electronic means - hitting paypal and having the paypal receipts received as goods and services. The service is looking for a 1099-k match and one has to report it. The handling of Turbotax to adjust the same should have been done via a check box ("did you receive a 1099-K for sale of personal items and you are not in a trade or business?" if yes, click here - then generate a statement support and adjust line 24z as a negative of 1099-K line 8 amounts. Additionally, please provide instructions on direct form entry (some of us dont use the guided style of entry). I tried the previous suggested approach and it did not result in "other misc income adjustment" - tried override in 24Z line - the final line does not calculate at all after an override is entered anyway.
Can Intuit consider this?
Would the instructions be clearer if one said
Open 1099-K Worksheet
1099-K amount entered from Box 1 will be visible at the buttom of the form called
1099-K Reconciliation line 1. If you sold personal property make the adjustment to line 2 and add a supporting statement " Cost of personal property sold:" as a description - enter same amount from 1099-K
Now - dont forget to print this with your 1040 as the zero in Schedule 1 - Other income will not force the statement to print as the amount is now zero due to the negative adjustment made. So you have to generate it manually. This may be an issue for E-Filing if this statement is not included. The IRS will see a zero amount on Schedule 1 and no explanation. This needs to be addressed by Intuit and soon as I expect many people received 1099-K for items sold personally as the limits have been decreased for 1099-K thresholds.
Again - you need to code 24Z adjustment line to be the negative one !
I spoke to an IRS telephone representative. I am explicitly to put the amount of my ATM surcharges on Form 1099-MISC on both lines 8z (as it appears in Box 3) and in lines 24z of Form 1 in order to have the bank changes not considered income. This is per the IRS Publication 525. No trickery like putting this number in line 8z as a negative will suffice. Again, per the IRS.
How does one enter something on Schedule 1, Line 24 using TurboTax?
Open your tax return
Go to wages and income
Go down to less common income
Click on the item you want to enter
Enter the details
Click on the item you want to enter
Click on the link for more information
This will allow you to enter something on Line 8z. The question is how to enter a deduction on Line 24z. As other users have stated, that is how you are supposed to display your non-taxable amount (instead of entering it as negative income on Line 8z of Schedule 1)
I see no way of entering anything on Schedule 1 line 24z regarding a 1099-K and I see nothing in any IRS publication that indicates you should.
If you want to enter the 1099-K and the adjustment, you can follow the instructions Stevos555 provided.
Instead of a negative adjustment on Schedule 1 line 8z, Schedule 1 line 8z will report the net amount.
The included supporting details document will supply the details concerning the adjustment if you want to be sure the IRS has that information.
The 1099K needs to be entered on the Business Income screen.
This can only be accomplished using TurboTax Home & Business Desktop.
According to the IRS:
"The Form 1099-K is an information return. Use this information return in conjunction with your other tax records to determine your correct tax. To get further information on record keeping, check out Publication 552, for individuals or Publication 583, Starting a Business and Keeping Record."
The only mention of 1099-K in IRS Pub 525 is the following:
"Generally, if you work in the gig economy or did gig work, you must include all income received from all jobs whether you received a Form 1099-K, Payment Card and Third-Party Network Transactions, or not. See the Instructions for Schedule C (Form 1040) and the Instructions for Schedule SE (Form 1040)."
Maybe I am dumb, but the IRS has a line on Form 1 called 24z but nobody should ever put anything on that line on that form under any circumstance even though the IRS agents are telling taxpayers to absolutely put the requested information on Line 24z. Got it!
Completely agree on using 24z, unfortunately Intuit locked that input completely and prefers to have an input in 1099K Reconciliation section line 2 of the Worksheet. As many of you who transact their personal items via facebook or ebay, you need to report 1099k as "other income" and adjust for the same as your cost of property sold is likely much higher. So unless you are in a business of selling goods on Ebay, personal household items sold has never been a taxable event. I struggle myself with how to enter the gross 1099-K amount and then take a negative adjustment - well apparently Turbo Tax Deluxe line 24Z has been off-limits because some one at Intuit decided it's not needed. Well, the only adjustment you can make from 1099K amounts flowing to your 1040 page 1 is to enter the identical information on the worksheet -1099K's. The problem with this method is that this worksheet and any supporting statement will not print or e-file with your return. So how do you think IRS is going to respond when they try and match your return to 1099K - you are getting a notice, be ready to answer such notice after receiving telling them Intuit did not allow me to enter into line 24Z so that the Service actually sees gross amount of "other income" matching 1099k and then seeing an adjustment for the same amount on 24z. Folks... we need to escalate this to Turbotax... they need to make the software work ...!
Interesting tid bit - entering in guided mode, going to 1099-K under Wages and Income, Intuit states that we don't need to report 1099-K at all..
Help file.. Form 1099-K
Form 1099-K is used by the IRS to track payments that you received from credit cards, debit cards, or electronic payment services (Square, PayPal, ePay, etc.).
For 2021 the IRS does not require you to report these payments separately. TurboTax will not give you a separate field for the amounts reported on your 1099-K(s), so be sure that you visit the other income topics to report any income that you received via credit cards, debit cards, or electronic payments in 2021.
Restricted access to 24z.. maybe in season 4 of stranger things they will open this up.
THERE IS NO INPUT IN 24Z even with an override.. the schedule does not compute. It's time for Tax Act!
As a long time user of Turbo Tax, I am completely frustrated. I have a perfectly legal reason to adjust my income downward as a graduate student (our University pay is handled oddly). The IRS provided Schedule 1, Line 24z, to report this adjustment, and Turbo Tax prevents usage of this line. Guess it's time to find a new tax program.
has anyone been able to use TT Home/Business to enter a comment and value on Schedule 1, line 24z? I'm entering my taxable Govt grant (1099-g) but it shows as personal income. I'm going to manually enter it in Schedule C (business) so I don't want to be double taxed
DO NOT enter the income twice ... only enter it in the Sch C income section.
This issue is also a problem for CA residents who received a 1099-MISC from the State of California for the inflation relief payment in 2022 - called the Middle Class Tax Tax Refund. CA FTB said the refund is not subject to CA tax but issued a 1099-MISC anyway because they said they weren't sure whether it was subject to federal taxes. So now taxpayers must report that 1099-MISC as income, but those of us who believe that the payment is not subject to federal tax because of IRC section 139 (disaster payments) have nowhere in TurboTax to put the adjustment.
Assuming your question is about the CA Middle Class Tax Refund (MCTR) you are correct the amount is non-taxable. You probably received a form 1099-Misc which is how you enter the amount. The latest update in TurboTax should correctly handle the MCTR payment.
This will automatically exclude this amount from federal income. On the federal tax return, the MCTR payment will reflect as a positive amount, as well as a separate negative amount.
Both the positive and negative amounts will show on line 8z on the Schedule 1. You can see these entries in the forms view for desktop versions or in the online versions by following these steps:
The income will no longer be in the Federal Adjusted Gross Income amount and therefore will not transfer to the CA tax return either.
The IRS definitely does indicate that we should put an entry on Schedule 1, line 24z. This is for the 1099-K paypal for personal property sales that everyone is talking about.
Here is the guidance from the IRS page on 1099-K's (from https://www.irs.gov/businesses/understanding-your-form-1099-k)
Scenario: Personal items sold at a loss
Action(s) to take:
If you receive a Form 1099-K for a personal item sold at a loss, report the information on Form 1040, Schedule 1, Additional Income and Adjustments to Income with offsetting transactions. For example, if you receive a Form 1099-K for selling your couch online for $700 you will report:
Part I – Line 8z – Other Income – Form 1099-K Personal Item Sold at a Loss $700
Part II – Line 24z – Other Adjustments - Form 1099-K Personal Item Sold at a Loss $700
The net effect of these two adjustments on adjusted gross income would be $0.
@ssdc wrote:
There is actually very clear guidance about using Schedule 1 line 24z to report 1099-K information. Specifically, for personal items sold at a loss.
I echo everyone else that it is very frustrating TurboTax/Intuit did not make a plan for the 1099-K's that were getting issued this year. I hope they fix it for next year.
I agree; they are treating this scenario as the sale of some sort of asset in the program so that the transaction winds up on Form 8949 instead of being offset on Line 24z of Schedule 1. Note that entering a description and figure on Line 24z requires an override and the use of Forms Mode for this purpose.
The screenshots below are indicative of how the scenario is being handled in TurboTax.
To report your 1099-Misc, select Wages & Income, then scroll down the screen to 1099-Misc and Other Common Income and select the option for Income from Form 1099-MISC. Enter your information.
On the screen Describe the reason for this 1099-Misc is where you will enter information describing your 1099-Misc as a CA MCTR. Selecting What if I got my 1099-Misc for something other than a job will produce the following response:
What if I got my 1099-MISC for something other than a job?
You might have gotten your 1099-MISC for prize money, a lawsuit settlement or another reason that wasn't work-related. In that case, simply type in the reason (like "prize money" or "lawsuit settlement").
If the reason for the 1099-MISC was California's Middle Class Tax Refund, type in "CA MCTR" as the description.
After entering CA MCTR in the description, you will see a screen where you can select This was a California Middle Class Tax Refund (MCTR).
@John-S II
Can anyone escalate this to Intuit to try to get the ability to add an entry to Schedule 1 line 24z (which then carries through to Form 1040 line 10) for this filing season? Or are we just going to be out of luck?
@ssdc wrote:
Can anyone escalate this to Intuit to try to get the ability to add an entry to Schedule 1 line 24z (which then carries through to Form 1040 line 10) for this filing season?
We are doing our best, I can promise you that.