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Get your taxes done using TurboTax
Because you received a 1099-NEC, the company that paid you does not consider you to be their employee. Whether you are an employee or independent contractor is a question of fact. As the IRS has previously stated,
"In determining whether the person providing service is an employee or an independent contractor, all information that provides evidence of the degree of control and independence must be considered....There is no “magic” or set number of factors that “makes” the worker an employee or an independent contractor and no one factor stands alone in making this determination. Also, factors which are relevant in one situation may not be relevant in another."
Here is the link to the IRS webpage from which the above quoted information was obtained.
Independent Contractor or Employee
A very important factor in determining whether you were an employee versus an independent contractor is the level of control the company had over you and the work you performed. In this regard, the IRS has stated,
"Under common-law rules, anyone who performs services for you is your employee if you can control what will be done and how it will be done. This is so even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed."
Employee (Common Law Employee)
If you determine that this was not self-employment income, but rather income you earned from an activity that was not regular or continuous or not part of your trade or business (in other words you were not in business for yourself), then you can report the income as Other Income.
If you are using TurboTax online, the steps described above are very similar to what you need to do to report your income as "other income." In TurboTax online, go to Income & Expenses, scroll down the page to the last item Less Common Income, select Miscellaneous income, then from the list select Other reportable income. Again you will have to enter the amount you earned plus a short description of the work you performed.
If you are using TurboTax Online, here are the steps to follow to preview your Form 1040:
Open or continue your return.
- Select Tax Tools in the left menu (if you don't see this, select the menu icon in the upper-left corner).
- With the Tax Tools menu open;
- Select Tools.
- Next, select View Tax Summary in the pop-up.
- Then Preview my 1040 in the left menu.
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