When you qualify for the foreign earned income exclusion and have a 1099-misc from a US company, where do you report that income in turbo tax? I keep getting errors...

AmberandDave · ‎June 1, 2019

We live outside the U.S. so we qualify for the foreign earned income exclusion (FEIE). My husband received a 1099-Misc for some consulting work he did in 2018. The amount is fully covered by the FEIE, therefore we shouldn't owe any taxes on it. In turbo tax, there are two places to put 1099-misc - one is in the standard income section (right after where you put in W-2) the other is in the section on foreign earned income. If I put this income in the regular income section, turbotax shows me paying tax on it. If I put it in the foreign earned income section, it shows we don't need to pay tax, but then there is an error at the end during the federal review that says the 1099 income needs to be reported on the schedule C. It let's you then go to the schedule C but the program won't let me modify anything there. Can someone explain where in turbo tax I should be including the 1099 income so I don't get this error any more?

KarenJ · ‎June 1, 2019

In TurboTax enter 1099 misc in the search box at the top of your screen and click the Jump to link. Enter the income in this section. It will be considered self-employment income.

Then in TurboTax enter foreign income in the search bar at the top of the screen and click the Jump to link. Enter the foreign income again in the foreign earned exclusion section as a 1099-misc. This will not double count the income.

When you qualify for the foreign earned income exclusion and have a 1099-misc from a US company, where do you report that income in turbo tax? I keep getting errors...

Deductions & credits