According to the IRS, income on Form 1099-PATR Box 5 should be reported as ordinary income. HOWEVER,
if the dividends in Box 1 of your 1099-PATR came from property purchased for personal use (or capital assets or depreciable property used in your business), you don't have to enter your 1099-PATR. Keep it with your tax records, though.
Most often, your Form 1099-PATR reports dividends associated with a farm or cooperative (co-op). You can also receive a 1099-PATR for other reasons (for example, a land bank mortgage or backup withholdings made on your behalf).
If your 1099-PATR isn't for farm or co-op dividends, it gets entered as general business income:
- Open (continue) your return in TurboTax.
- Inside TurboTax, search for business (schedule c) (use this exact phrase) and then select the Jump to link in the search results.
- When asked Did you have any self-employment income or expenses? answer Yes.
- If you'd previously entered self-employed income, you'll come to Your 2020 self-employed work summary. Select Add another line of work to enter information about your farm.
- Follow the instructions to enter info about your farm.
- When you get to Let's enter the income for your (type of farming) work, select Other self-employed income and Continue.
- Enter the information from your 1099-PATR on the Tell us about other self-employed income screen.
Here is an article that explains Form 1099-PATR.
