If you are referring to paying someone as a personal expense, such as paying a handyman for completing a project on your home, than no deduction is available.
If you are the owner of a small business and report business income and expenses, then contract labor is a deductible business expense. To enter the labor as a business expense:
- Under Federal, select Wages & Income
- Select Start/Revisit next to Self-employment Income & Expenses
- Continue through the screens until you reach the entry for the business expenses
- Under Less Common, choose Contract Labor, select Continue
- Follow the screens until you are able to enter a description and dollar amount
Contract labor paid $600 or more requires the issuance of a 1099-NEC.
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