You should deduct your expenses against the income reported to you on Form 1099-MISC.
You will use Schedule C Profit or Loss from Business to report your 1099-MISC income and expenses.
In TurboTax Delux Select Income & Expenses.
Select W2 to follow prompts to enter your W2 information.
When you are done with the W2 section select income from 1099-MISC.
Follow the prompts to enter your 1099-MISC information.
