Deductions & credits

The best way to enter this to net it out is to enter the 1099-NEC like business income and enter the equipment purchase as a business expense.  You will need to delete your 1099-NEC entry to be sure you mark None of these apply to me on the Does one of these uncommon situations apply? screen.

To delete your 1099-NEC you can follow these steps:

1. Within your return, click on Tax Tools in the black menu on the left side of the screen.
2. Click on Tools.
3. Click on Delete a Form. 
4. Scroll down to your Form 1099-NEC and click Delete.
5. Under Federal in the black menu bar click Wages & Income to get back into your tax returns.

To re-enter the 1099-NEC and enter the expense to offset the income you can follow these steps:

1. Sign in and open or continue your return.
2. Search for 1099-NEC and select the Jump to link.
3. Answer the questions and continue through to enter the information from your form.
   • Be sure to choose None of these apply to me on the Does one of these uncommon situations apply? screen.
4. Continue through the interview until you are done.
5. Using the magnifying glass at the top of the page search for Schedule C.
6. Use the Jump to link that shows in the results.
7. Click Review for the business added from the 1099-NEC
8. Choose It's something else on the OK - how does your Reimb work fit into your big picture? screen.
9. Mark that the business started AND stopped in 2022 (you can choose any date in the year for the start date or just the transaction date if you know it)
10. Click None of these apply and Continue through the rest of the interview answering No and None of these apply to the questions.
11. Click Get Started on the Let's find all the expenses... screen and choose the Supplies category then Continue.
12. Answer No to the suggested expense categories and Keep Going.
13. Click Start next to Supplies and enter the cost of the equipment purchased and Continue.
14. Scroll down and click I'm done and continue entering your remaining tax return information.