@katherrera9 wrote:
Hello,
For those that went through this experience, can you please share if you indeed had to pay taxes on Bank of America's Down Payment Grant Program? I am currently being offered this grant, so it would be great to receive first-hand experience. Were you able to make an entry and cancel out the grant amount? Or if you did have to pay taxes on it, was the tax rate on it 15.3%? Please help!
Miscellaneous or "other" income is taxed at your regular income tax rate, which might be 10%, 12% or 22%, for most taxpayers, and depending on your income, filing status, and other deductions. The special 15.3% tax rate is for self-employment tax and is in addition to income tax, but it only applies to income earned from working (like a side gig) and not to this type of "other" income. If you are charged self-employment tax, you have entered the 1099 in the wrong place in Turbotax.
