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ack0325
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Why does it keep say I own a business because I got a 1099

 
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2 Replies

Why does it keep say I own a business because I got a 1099

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.

 The IRS also considers undocumented cash income (no W-2 or 1099-MISC), for work performed, to be self employment income. 

GiseleD
Expert Alumni

Why does it keep say I own a business because I got a 1099

If you received a 1099-MISC for an activity you performed as an independent contractor (nonemployee), you will be subject to self-employment tax if the amount received is over $400. Essentially, you are considered self-employed, so TurboTax is routing you appropriately through the interview. Fortunately, you are allowed to deduct all ordinary and necessary expenses incurred in your trade or business. TurboTax Self-Employed will walk you through entering these expenses.

 

@ack0325

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