Education

No. You would enter her 1099-MISC on her return as shown and then enter a separate line in Other Income with a negative. The net of these two numbers will be the amount she is taxed on, which will be zero. Do not create a second 1099. 

Once you enter the 1099-MISC and it flows to Other Income, please enter the negative amount as follows: 

1. Click on Federal on the left hand side.
2. Scroll down to Less Common Income.
3. Click Start next to Miscellaneous Income.
4. Click Start next to Other reportable income.
5. Answer Yes to Any Other Taxable Income?
6. List description/reason it is nontaxable.
7. Enter the amount with a negative.

Next, preview your 1040 to ensure both the 1099-MISC and the negative number net to zero and are both reported in Part I, Line 8.

1. Click on Tax Tools. 
2. Click on Tools.
3. Click on View Tax Summary under Other helpful links.
4. Click on Preview my 1040.
5. Once open, use Control + F, and search Schedule 1 and look for Line 8. 

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