1099-NEC

3 replies
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I received a 1099 - NEC for a scholarship. How do I report it? If I report it in the business income, how do classify the business? Is it a cash business? Do I owe Self Employment taxes on it?

Greatly appreciate any help.

Scholarships

Hal_Al

Level 15

The IRS considers anything on a form 1099-NEC to be self employment income. Enter the 1099 income, at 1099-MISC and Other Common income / income from a 1099-NEC . TurboTax (TT) will complete Schedule C 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 $432. If you try reporting 1099-NEC income as anything else, you chances of hearing from the IRS are higher. But, if it was a one time thing, it's easier to prove.

That said, scholarships are not reported on a 1099-NEC or even a 1099-MISC. What are the circumstances of you receiving this "scholarship". Who did you get it from and why did you get it? Was the money paid to you or to the school? If to the school, was it also reported in box 5 of your 1098-T?

kschmidAuthor

Level 2

It is a scholarship award from an industry organization (construction), not an educational institution. It was paid directly to me not my university. I also received a 109-T from my university. For the business classification should I then list construction not education?