The only resource I can reference are the instructions for the 1099NEC and the 1099M. This NEC form instructions state it be used for non employee compensation only. The 1099M form indicates use Box 3 for awards and incentives.
irregardless of the form used, this is what I sent to H&R Block who was doing my father in laws taxes and she agreed with this information. Even though the fire department sent the NEC form it should not be reported o. Schedule C.
I did some research on the Schedule C and this is what is in the first paragraph of the instructions:
An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity, not-for-profit activity, or a hobby does not qualify as a business. To report income from a nonbusiness activity, see the instructions for Schedule 1 (Form 1040), line 8.
Since the primary purpose for engaging in the activity of Volunteer Fireman was not for income but more of a hobby and a sporadic activity depending on the # of calls in a given week, it does not qualify as a business.
I also looked at the Schedule 1 line 8 instructions and this is what it states:
Line 8 Other Income
Do not report on this line any income from self-employment or fees received as a notary public. Instead, you must use Schedule C, even if you don’t have any business expenses. Also don’t report on line 8 any nonemployee compensation shown on Form 1099-MISC or 1099-NEC (unless it isn't self-employment income, such as income from a hobby or a sporadic activity).
Again mentioned is a hobby or sporadic activity. I don't think Schedule C is the correct form to use for his volunteer work given that it is NOT self-employment income, sporadic, not intended to be a source of income, and more of a hobby than a business. Please let me know if you and the team at HR Block disagree.
Hope this helps!
