DoorDash and Schedule C

I received a 1099-NEC form from DoorDash for 2020.  If I input the income and choose "No, I don't have expenses related to this income", TurboTax allows me to complete the return without creating a Schedule C.

If I choose "Yes, I have expenses to deduct", it creates a Schedule C and makes me answer a bunch of questions.   My tax refund is bigger if I choose "No, I don't have expenses related to this income."

 

What's the correct answer here?  I'm reading everywhere online that as a Dasher, I should file a Schedule C form but it looks like the TurboTax program allows me to complete the return without having to do that.  I'm fine with not claiming expenses since it keeps things simple and my refund is bigger but I want to do the right thing.

I appreciate your assistance with this.

AnnetteB6
Employee Tax Expert

Deductions & credits

Even if you do not have expenses to claim, income from being an independent contractor for DoorDash should be reported on Schedule C. 

 

This income is subject to self-employment tax and that is what is causing your refund to drop when you indicate that you have expenses to claim.  Including the income on your return without it being reported on Schedule C and being subject to self-employment tax is likely to trigger a letter from the IRS.  

 

It is possible that you do have some expenses that you can claim against your income.  Doing so will reduce your self-employment tax and increase your refund.  Take a look at the TurboTax article below for some examples of possible expenses that you may not have considered.

 

What self-employed expenses can I deduct?

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Deductions & credits

Thanks for the quick reply!  If a Schedule C is required regardless of whether I choose to deduct expenses or not then I think Intuit needs to update their TurboTax 2020 software.  When I opted not to deduct expenses, it put my DoorDash income in the "Income from Form 1099-NEC" section and didn't ask me to create a Schedule C.  Might be a bug in the software.  Anyways, thanks for the info!

CatinaT1
Employee Tax Expert

Deductions & credits

I didn't even think to include this when I answered you earlier. 

 

Currently there is a known issue when using TurboTax Online that is related to the program asking you to double-click to link to Schedule C. 

 

Please review the article below and use the link in the article to enter your email address to be notified once this is resolved:  

 

TurboTax: Why Am I Unable to Link my 1099-NEC?

 

 

Also you can review the information below for a possible steps to solve the issue.  

 

Income reported on Form 1099-NEC must be reported on Schedule C, the program is trying to link these two forms together to be sure that it is reported correctly and on the right form.

 

Revisit the section where you entered the Form 1099-NEC if you entered it on its own and delete that entry, by following these steps:

 

  1. Open TurboTax.
  2. On the top right corner of TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner).
  3. Type in “1099-NEC” (or for CD/downloaded TurboTax, click Find),
  4. Click on “Jump to 1099-NEC
  5. Click on the blue “Jump to 1099-NEC” link

 

This will bring you a summary of all Form 1099-NEC that you have entered.  Click Delete or the trash can icon next to each one.

 

Next, you will re-enter the Form 1099-NEC as part of the Schedule C so that the income is reported directly as part of your Business Income and Expenses and within the correct form and section of your return.

 

Follow these steps to go to the Schedule C section of your return:

 

  1. On the top right corner of TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner).
  2. Type in “schedule c” (or for CD/downloaded TurboTax, click Find).
  3. Click on “Jump to schedule c”.
  4. Click on the blue “Jump to schedule c” link

 

If you already have created a Schedule C in your return, click on edit and go to the section to Add Income.  This is where you will re-enter the Form 1099-NEC. 

 

If you do not already have a Schedule C in your return, follow the prompts and enter the information about your work/business for which you received the Form 1099-NEC.  Then continue through that section to Add Income and enter the Form 1099-NEC along with any additional income you received for that business.  

 

Once you have completed this, the error should be eliminated. 

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