I have a unit in a Condo Hotel in Vegas that is rented out on a daily or weekly basis throughout the year. The management at the end of the year sends me a 1099misc for the income. Do I also have to fill out a Schedule E? Thx
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Yes, this income needs to be reported on Schedule E. Please follow the directions below to set up your rental property information and report your 1099-misc income:
Tip: Rent is considered income in the year you received it, not the year it applies to. This means that a rent payment for the month of January 2020 collected in December 2019 is reported on your 2019 return.
@Keyang wrote:I have a unit in a Condo Hotel
You said "hotel". Are "services", such as maid services or meal provided to the tenants? If so, it is a business on Schedule C, not a rental on Schedule E.
The form 1099-MISC might offer a clue as to whether the income is rental or business income.
Rental income is normally reported in box 1, while self-employment income is normally reported in box 7 of the 2019 form 1099-MISC.
So, with the new 1099 NEC should condo hotel income be reported net on the NEC or Gross on the 1099 Misc box 1?
Thank you!
It depends. If it is passive rental income, it is reported on the box 1 of Form 1099 MISC. If you're actively participating in the business, it could be self-employment income, and it is reported on the Form 1099-NEC.
Thank you for the information.
I was under the impression that for a condo hotel with hotel like amenities, the NEC is the proper place to report net paid whether the income is passive or active.
This is due to the fact the hotel is a trade or business rather than a rental business.
Do you have an opinion on this interpretation?
Thanks!
@bethkane3113 The place that runs the business- the condo hotel, is a business. If all you do is rent our your space and have nothing else to do with it, you would have a rental. Each situation is unique. If you would like to reply with more information, we may be of more help.
The NEC is for services while the MISC is for rents. Here is the complete breakdown:
The 1099-NEC is for each person to whom the taxpayer has paid at least $600 during the course of a business for the following.
•Services performed by someone who is not an employee, including parts and materials (box 1),
•Cash payments for fish (or other aquatic life) purchased from anyone engaged in the trade or business of catching fish (box 1), or
•Payments to an attorney for legal services (box 1).
The Form 1099-MISC is for each person to whom the taxpayer has paid the following during the course of a trade or business.
•At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest,
•At least $600 in rents (box 1), prizes and awards (box 3), other income payments (box 3), the cash paid from a notional principal contract to an individual, partnership, or estate (box 3), any fishing boat proceeds (box 5), medical and health care payments (box 6), crop insurance proceeds (box 9), payments to an attorney (box 10), IRC section 409A deferrals (box 12), or nonqualified deferred compensation (box 14).
•Any payment from which federal income tax has been withheld (box 4) under the backup withholding rules
So the condo association should issue to owners a 1099 Misc for the rentals on their units gross vs a 1099 NEC for their share of profit received net?
Thank you!
Beth
Yes - You are correct. You are simply renting out your property, with the help of the condo association.
Thank you!
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