How to Categorize 1099-NEC - Union Wage Replacement

[1099nectaxquestion]

Hi all,

My husband is a member of a union and attended a training during work hours. The union paid replacement wages for the training time and sent us a 1099-NEC. I can't figure out how to submit this using Turbo Tax as it doesn't fit any of the categories that the 1099-NEC form allows and it's not a strike benefit if I go through the 1099-MISC form.

Thanks!

[DianeW777]

It depends. If your husband is a union officer or a union employee, then it should be reported as self employment which is the specific designation this form is used for. Be sure to enter any applicable expenses which will lower the amount that is taxable.

1. Open or continue your return. 
   • TurboTax Online/Mobile: Search > Type 1099-NEC > Go to 1099-NEC
   • TurboTax Desktop: Search for 1099-NEC and select the Jump to link.
2. Follow the onscreen instructions. 
3. When you’re done entering the income, we’ll ask you a few questions.
4. Be prepared with any direct expenses you may have which will reduce your taxable income.

[1099nectaxquestion]

He is neither a union officer or employee. He is a union member who was paid replacement wages for a training that took place during work hours (topic adjacent too, but not the core function of his work as a union member). That's what's been stumping me -- I don't know how to categorize it.

[DianeW777]

He is an employee of a union job, is that correct? If so, the answer still applies.  Please update if it is unclear.

@1099nectaxquestion 

[1099nectaxquestion]

He is not an employee of the union. He is a member of the union. He is employed by companies that contract with the union.

From what you've said, that counts as self-employed income. I think it's just not a common use case.

[ThomasM125]

I believe then that he got reimbursed for the wages he missed for the time he spent in training. In that case, what he received was wages so he needs to pay social security tax on that income. If you treat it as self-employment income, that will accomplish that. However, the company should have reported it as wage income on a W-2 form, so you could ask them to correct that, but they likely won't do that. It is interesting to note, if he reports it as self-employment income, he will have to pay approximately an extra 7.5% self-employment tax equal to the share of social security tax the company should have paid.