Barrygbg1
Returning Member

How do I prevent Turbo Tax from calculating SE Tax on a payment I received from a prior employer in 2016 on a 1099 for some phantom stock I had held in the company?

I know the full distribution is Taxable Income but it was not earned as part of my current consulting business, which TT seems to want to do.  So yes I pay taxes but should not be paying Self Employment tax.  Any ideas?

IreneS
Intuit Alumni

Get your taxes done using TurboTax

UPDATED FOR TAX YEAR 2019

 

You can enter the 1099-MISC in TurboTax as "Other Common Income," which is reported on line 8 of 1040 Schedule 1 and will not generate Schedule C or SE tax.  Please use the following steps:

  1. Click on Federal > Wages & Income.
  2. Scroll down to the Other Common Income section. 
  3. Click on the Start/Revisit box next Form 1099-MISC. 
  4. On the screen Did you get a 1099-MISC?  click on the Yes button.
  5. On the next screen, Let's get the info from your 1099-MISC, enter the information from the 1099-MISC.
  6. On the following screens, answer the following questions:
    • Did it involve work that's like your main job? No.
    • You got it in 2019
    • No, it didn't involve an intent to earn money

      7.  Continue through the rest of the interview screens. The income will appear as Other Income.

 

[Edited | 4/9/2020 |  12:44pm PDT]

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Barrygbg1
Returning Member

Get your taxes done using TurboTax

Thank you very much.