I receive a 1099-MISC for school transportation reimbursement for my children to attend a private school. Is this to be reported a income?

[kirbkey]

My children attend a private school. My local school district chooses to reimburse me with a monthly check rather than provide transportation to and from school for my children. Do I need to report this as income on my tax return?

[HelenaC]

Yes, you would report this as income but turn around and report it as a transportation expense so the net amount is zero taxable income to you.

To enter your business income and expenses: 

• Type Sch C in the search/find bar and click search/find.
• Click on Jump to Sch C.
• Click on start or Add Another Business.
• TurboTax will ask you a series of questions to record your business income and expenses. 
• Enter your 1099-MISC form. For Business Description, you may enter Transportation, Code 999999.
• Enter the transportation expense under Other Common Business Expenses, Miscellaneous Expenses. Enter Transportation Expense as the Description.

[inquiringminds1]

If this is a private special education school, isnt it the IRS position that the mileage reimbursement should not be includible in the parent's gross income, as well as not reportable as such by the school board, as the reimbursement was on behalf of the expenses incurred by the school board that they would be responsible for?

[milleradfran]

Yes, as long as private school placement was subject to an IEP under the I.D.EA. either by agreement or settlement- thus making school board obligated under FAPE.  See IRS  Rev  Ruling- Rev. Rul. fifty seven- sixty, , clarified by Rev. Rul. sixty - two eight zero (Intuit will not allow me to write numbers) holds that reimbursement to a parent for transporting his/her child is not includible in income of the parent because the parent is being reimbursed for an expense incurred on behalf of the school board which was obligated to furnish transportation to school children.

[mleonard2]

so do we need to include it anywhere on our taxes?

[DaveF1006]

Yes, since a 1099 MISC was received by you, this will be need to be reported on your tax return as income. Here is how you will report it.

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 –  indicate it is a school transportation reimbursement

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.

[mleonard22]

But then do as the original poster said and mark it as a business expense?  It should be taxable as my child has it in her IEP.  And which box should it be put in?  My 1099 is lost in the mail and I have my receipts and wanted to try and do it with that if I could.

[DaveF1006]

At this point, i would either request another copy of the 1099 or report it as less common income. It would not be reported as business income because this is not a business so you cannot claim expenses against it. Here is how to report it without a 1099 MISC..

1) Sign into your account and  select Take me to my return

2.   From the top, select tab Federal Taxes / Wages and Income 

3.   Scroll down to Less Common Income section.

4.   Choose Miscellaneous Income, 1099-A, 1099-C / Start

5.   Move all the way to the bottom where it says Other Reportable Income. Select Start 

6)  Select yes on the next screen. Give it a description as school transportation reimbursement.

The instructions says not to enter this if there has been a 1099 Misc issued but since you do not have one, this is the only way you can report the income. You can either report it in this manner or you can try to get a copy 1099 MISC from the school. DO NOT HOWEVER REPORT THIS AS A BUSINESS ITEM..if you do receive a 1099 MISC, report it as I have instructed you previously. 

[jandy2]

I followed these instructions to a T and given that its an IEP related transportation reimbursement it should not be taxable, but my return decreases every time I enter it in this manner

[Hal_Al]

@jandy2 

"given that its an IEP related transportation reimbursement it should not be taxable"

The IRS considers anything on a 1099-Misc to be taxable and if the amount is in box 7, to be self employment income.

If you received an erroneous 1099-Misc (and I think you did); You have several choices (I would use #4):

1. Ideally, you get a corrected 1099-misc from the payer
2. Don't report it on your return. Attach a copy of the 1099 and a statement explaining the circumstances. You can't e-file. From the IRS instructions for form 1099-Misc: Form 1099-MISC incorrect? If this form is incorrect or has been issued in error, contact the payer. If you cannot get this form corrected, attach an explanation to your tax return and report your income correctly.
3. Report the Income on schedule C and take a deduction under other expenses, call it something like "erroneous recipient adjustment"
4. Report the income as misc line 8, Schedule 1 income (enter in TurboTax at the 1099-Misc screen, as described above. Then enter a line 8 deduction, for the same amount.  In TurboTax (TT), enter at:
   - Federal Taxes tab
    - Wages & Income
   Scroll down to:
   -Less Common Income
         -Misc Income, 1099-A, 1099-C
          - On the next screen, choose – Other reportable income -  Answer yes to Any other Taxable Income -On the next screen, Enter the number with a minus sign (-) in front.  Briefly explain at description.
5. Do nothing and hope you can explain it away when & if the IRS contacts you

[Amburgey75]

I have a issue we’re the IEP was not implemented  for drivers Education. I filed a state complaint. They have agreed to reimburse me but they want me to file a W-9. I’m not following??? I don’t understand. I didn’t provide them with a service. I’m not an employee. I paid for private drivers Education for the provision of FAPE the district was found in non compliance. Where exactly is the laws. I copy and pasted your last response I can’t find publication or the rule it comes up as something else. Help please 

[Hal_Al]

It's simple: you have to fill out the W-9 and give them your SS# before "they" will issue you a check.  They must think they need to issue a 1099-Misc.  Then you need to deal with it as described above.  As you see, from this thread, and many more like it, it's a common problem.