No this isn't taxable income. Please view this awesome post from our esteemed Expert Toddl99 as he explains how to report this as non-taxable income. Here is an excerpt from his post.
Enter the information as follows in the 1099-MISC interview:
- Enter the 1099-Misc in the Other Common Income section of wages and income or income and expenses.
- Go to other common income>1099 MISC
- Enter the 1099 MISC
- When it asks for the reason, indicate it's a Bank of America Down payment Grant
- When it asks for uncommon Situations, say none.
- Next screen indicate does not involve work like your main job,
- Answer the next screen and then the next one will ask if there was an intent to make money. Here say no.
- The money will now be reflected in line 10 of the 1040.
Now let's make that money non-taxable.
- Now go to Less Common Income> Miscellaneous Income>
- Now go to Other reportable income.
- Enter "Bank of America Down payment Grant" in the description field and enter the amount of your 1099 MISC as a negative amount. Enter this as -XXXX.XX. Enter actual amount after the minus sign and not those X's.
- After this is posted, there will be an adjusting entry reported in line 8Z of Schedule 1 and the income from the 1099MISC will not be reflected in Line 10 of the 1040.
Normally a reasonable person may ask, why report this at all. It is because you received the 1099 MISC that has also been filed by the IRS. It must be reported but since it isn't taxable, it can be backed out of income that has been reported.
@Ggaga
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