You can enter the rent that your boss paid as additional wages that were not reported on a W-2. You will have to pay the Social Security and Medicare taxes that the employer would have withheld if he had included the rent in your W-2.
The rent amount will be reported on Form 1040 line 1g. Form 8919 will be included in your tax return, with reason code H in column (c). Form 8919 will calculate the Social Security and Medicare taxes. The total of these taxes will appear on Schedule 2 line 6 and will be included in your total tax liability.
Follow these steps to enter the bonus. The first few steps might vary a bit in TurboTax Online, depending on what you have already done.
- On the left side click Federal.
- Click Wages & Income.
- Click "I'll choose what I work on" or "Jump to a full list."
- On the screen "Your 2022 Income Summary," scroll all the way down to the last section "Less Common Income." Click the Start button for the last topic, "Miscellaneous Income, 1099-A, 1099-C."
- On the next screen click the Start button for "Other income not already reported on a Form W-2 or Form 1099."
- The next screen asks "Did you receive any other wages?" Select Yes and click Continue.
- The next three screens ask about household employee wages, sick or disability pay, and Medicaid waiver payments. Click Continue on these three screens without entering anything.
- The next screen asks "Did you earn any other wages?" Select Yes and click Continue.
- The next screen asks the source of the other earned income. Select "Employee compensation that was not reported on a W-2." Click Continue.
- On the next screen, "Employee Compensation Not Reported on a W-2," click Continue.
- If you are filing a joint return, you will get a screen asking which one of you the income is for. Select your name and click Continue.
- On the next screen, "Report Your Wage Income," enter the employer's name and EIN from your W-2. For Total Wages Received, enter the total amount of rent for the year. For the Reason Code select "H - I received a Form W-2 and a separate Form 1099-MISC and/or 1099-NEC and the income should have been reported on Form W-2." Select code H even if you did not get a 1099-MISC or 1099-NEC. Click Continue.
- Read the next screen, "Report as Wages," and click Done.
