RobertG
Expert Alumni

Get your taxes done using TurboTax

You are correct that it should not be reported as a capital gain.

 

Bonuses or awards you receive for outstanding work are included in your income and should be shown on your Form W-2.

 

However, you can still report it on your tax return as employment wages by following the instructions below:

  1. Click the Federal tab on the left side of the screen
  2. Click Wages & Income 
  3. Scroll down to see all income and click show more beside Less common Income
  4. Click Start beside Miscellaneous Income, 1099-A, 1099-C
  5. Click start beside Other income not already reported on a Form W-2 or Form 1099
  6. On the next screen answer Yes to Did you receive any other wages
  7. The next two screens relate to household employees. Click continue to move past them.
  8. On the next screen, answer Yes to Did you earn any other wages
  9. On the next screen, select Employee compensation that was not reported on a W-2. (disregard note about a 1099-misc form)
  10. On the next screen, click continue to reach the screen where you will report your employer's EIN and the income you received.

As for the 1099-B, you should report it with your basis equal to your bonus, so you show no gain or loss.

 

This question was previously answered by KatrinaB48

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