You can report hobby income on Form 1040 Schedule 1 line 8 when the income is not considered to be self-employment.
Here are the steps:
- Go to Wages and Income > Other Common Income > Income from Form 1099-NEC and click Start or Update
- Enter the details reported on your Form 1099-NEC
- Describe the reason you received the income
- On the screen titled 'Does one of these uncommon situations apply?', select the This is not money earned as an employee or self-employed individual, it is from a sporadic activity or a hobby choice
The result is that the income is reported on Form 1040 Schedule 1 line 8z with the amount and description that you entered.
If your spouse expects to continue to make money training dogs and the involvement progresses past being a hobby and needs to be reported as a self-employed business so that expenses may also be claimed, then enter the income and expenses on Schedule C.
To learn more, take a look at the following TurboTax help article and an article from the IRS:
When the IRS Classifies Your Business as a Hobby
Here’s how to tell the difference between a hobby and a business for tax purposes
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