Where to enter 1099-Misc information from Cares Act 2020

[Woodman228]

I received a 1099-Misc with other income amount due to the Cares Act grant in 2020 for rental assistance.    I tried to enter this in Schedule E section but would not take since the Rents box is blank.    Where do I enter this information (what section)?    Thanks

[KathrynG3]

Please explain a little more so I can better answer your question.

1. What box is the income in?
2. Who gave you the grant?
3. Is this for your personal rent or is in on behalf of a tenant?

@Woodman228 

[Woodman228]

1.  Other Income Box on the 1099-Misc

2.  The State where we have rental property

3.  We rented the property for all of 2020.    

[KathrynG3]

Thank you for the clarification. What you need to do in TurboTax is report Form 1099-MISC as received, remove it, and finally include it with your Rental Activity.

Enter Form 1099-MISC following these steps:

Step 1; Enter Form 1099-MISC as received.

• From the left menu, select Federal, which will open to the Income & Expenses tab.
• Scroll down to Other Common Income and select Show More.
• Select Form 1099-MISC and enter your details. 
• Go through the questions, but for now, answer No to Did this involve the intent to earn money? so that the income is not put on a Schedule C.
• Finish any other questions. You will eventually select Done.

Step 2: Enter Form 1099-MISC as an offsetting, negative amount.

• Back at Income & Expenses, where TurboTax returns after entering Form 1099-MISC, scroll all the way to the end to find Less Common Income and Show More.
• Scroll down to Miscellaneous Income, 1099-A, 1099-C and select Start.
• Scroll all the way to the last option, Other reportable income and select Start.
• Any Other Taxable Income? answer Yes.
• For Description, enter Form 1099-MISC Other Income reported on Schedule E and enter the amount as a negative. For example for negative $100, enter -100. 

Step 3: Enter the amount in Box 3 of Form 1099-MISC for your Rental Property.

• Back at Income & Expenses, scroll down to Rental Properties and Royalties (Sch E) and select Edit/Add.
• Select the rental property associated with Form 1099-MISC and select Edit.
• Select Add Income.
• Enter the amount in Box 3 of Form 1099-MISC under the first option, Cash, checks, Form 1099-K, etc. to report Form 1099-MISC received for rental assistance and Continue.

The rental assistant programs differ state to state. The requirements of the assistance should be reviewed to verify that it is taxable, needs to be reported and whether it will be taxable at the federal and/or state (if your state collects income tax) levels.

[Edited 02/08/2021 | 6:02 AM PST]

@Woodman228

[Woodman228]

Step 1 and Step 2 entered.    Yeah!!

Step 3.    I received an error when adding this under Rental Income section from the Rental and Royalty Summary for this property (selected EDIT button).   It will NOT let me report the income with this property.   Turbo Tax says "Can't Report this Income Here.    You entered other income of XXXX on this form 1099-Misc.     You can't report other income on a rental property.    You can report this income on another form or schedule later in the Interview."

[DaveF1006]

instead of reporting it as rental income, you may report it as other income.  Here is the procedure.

You will report this in your Turbo Tax return as it is income. Here is the correct way to report it. First

1. Log into turbo tax
2. Before you take the remaining steps, I suggest you delete the original 1099-Misc you reported as rental income so this procedure will work correctly. once it's deleted then reenter using the following steps.
3. Go to federal>wages and income>other common income
4. Form 1099-MISC>revisit or start
5. Select edit next to the 1099-MISC
6. Scroll through the entry and then the program will ask Describe the reason for the 1099-Misc 
7. As you move through the screen, the program will ask if this is like your main job.  If you say yes, it will expect you to fill out a schedule C. For this purpose, say no.
8. Next it will ask how often did you receive this income. If this was the first year you received it, indicate so.
9. Now it will ask you if you have the intent to earn money.  Indicate no.
10. if this is done correctly, it will not ask for a Schedule C because this will appear as OTHER INCOME in your return.

[Edited 02/08/2021|11:15 PST]

[Hal_Al]

Alternate way to enter it:

At the 1099-Misc screen, put the amount in box 1 instead of box 3.

[Woodman228]

Please let me know if this is correct:

1099 was entered from my Management Company with XXX dollars for rent

1099 was entered from the Cares Act for xxx dollars for rent

Is the 1099 Cares Act Taxable?    The amount was added back to my rent total for the year.

Thanks   

[AmyC]

The government distributed a lot of funds to the states. It was then up to the state to decide how to distribute. Rental income is taxable and the state sent you a form to prove it.