My wife received a 1009-MISC for $800. She doesn't own a business and doesn't have any expenses. Does she have to create a fake business (Schedule C) in TT?

[Nick-Y]

My wife received a 1009-MISC for $800 for assisting a High School Theater group with fitting costumes. She doesn't own a business and doesn't have any expenses. Do I have to create a fake business (Schedule C) for her in TT in addition to me entering her 1099-MISC into TT?

[IreneS]

What box was the income reported in -- box 3 or box 7?

[IreneS]

This will determine the appropriate way to treat the income in your case (Hal_Al's method or mine).

[IreneS · Accepted solution]

No.  You can enter the 1099-MISC in TurboTax as "Other Common Income," which is reported on line 21 of the 1040 and will not generate Schedule C or SE tax.  Please use the following steps in TurboTax CD/Download editions):

1.      Click on Federal Taxes > Wages & Income > I'll choose what I work on.

2.      Scroll down to the 1099-MISC and Other Common Income section. 

3.      Click on the Start/Revisit box next Form 1099-MISC.  [See Screenshot #1, below.]

4.      On the screen Did you get a 1099-MISC?  click on the Yes button. [Screenshot #2]

5.      On the next screen, Let's get the info from your 1099-MISC, enter the information from the 1099-MISC.
[Screenshot #3]

6.      On the following screens, answer the following questions:

• Did it involve work that's like your main job? No.
• You got it in 2017
• No, it didn't involve an intent to earn money

7.  Continue through the rest of the interview screens. The income will appear on line 21 of form 1040 (Other Income).

[Hal_Al]

There is a "one time gig" exception to reporting box 7 of a 1099-Misc as self employment income. The activity you describe (assisting a High School Theater group with fitting costumes) certainly doesn't sound like self employment. But If you try reporting box 7 income as anything else, your chances of hearing from the IRS are high.

[Hal_Al]

Yes. 

Although it may be news to you that you “have a business” (and most of the other people who get their first 1099-MISC); The IRS considers anything in box 7 of 1099-MISC to be self employment income. Enter the 1099-Misc income, at Other Common income / income from a 1099-MISC . TurboTax (TT) will complete Schedule C or C-EZ for you and allow you to deduct any expenses associated with this income. You'll also have to pay self employment tax (social security & Medicare) on any profits greater than $400. These types of payments are frequently done this way. Your "employer" is not the only one.