I received a 1099-MISC from a brokerage firm for "goodwill" cash paid when transferring funds and opening a new account. The 1099-MISC include payments for "termination fees" incurred when closing accounts and transferring funds to new brokerage. What is the best way to report "termination fees" as expenses in order to adjust the amount of goodwill cash received? TT instructs me to report the 1099-MISC as a business in order to report the expenses against it.Not sure if that is appropriate given that the income was not related to work performed? Any suggestion on how best to deduct termination fees?
Sorry, but at the federal level, expenses incurred when producing income, are currently not deductible for 2019, nor were they last year. They can be a miscellaneous itemized deduction on your state return in at least some states, e.g. CA, but such miscellaneous expenses have to add up to over 2 1/2% of your adjusted gross income to have any effect.
Not sure if I follow. I am not speaking of itemizing investment expense, which is no longer deductible for Federal return. In my case, I have received a 1099-MISC for "other income," which includes "termination fee" reimbursed by the new brokerage firm. I need to deduct those fees. TT suggest reporting it on schedule C in order to be able to report related expenses. I am asking if there is an alternative way of reporting the termination fee against the 1099-MISC income.