1099-MISC - Educational Stipend

ali-nakata — Sat, 01 Jun 2019 08:27:59 GMT

I was sent a 1099-MISC for an Educational Stipend that I received, but my state tax return is saying that because of that, I'm self employed and need to enter the Business Tax ID Code (which I don't have). What do I do?

The fact that you have 1099-Misc slightly complicates the...

TomK — Sat, 01 Jun 2019 08:28:01 GMT

The fact that you have 1099-Misc slightly complicates the matters. There will be a few steps to follow to report your stipend correctly because of the form 1099-MISC. First, you would have to report 1099-MISC and make adjustments for the IRS matching purposes. Then you would report the stipend correctly using steps below.

REPORT 1099-MISC

IF box 3 reports your stipend, report the form:

To enter/edit a 1099-MISC form:

Open (continue) your return if it's not already open.
In the Search box (top right-hand corner), type “1099-misc’
Click on the Magnifying Glass icon.
Click on “Jump to 1099-misc” link high-lighted in Blue.
Answer the Step-by-step instructions.

and make adjustment using the steps below:

Federal taxes
Wages and Income
Scroll down to Less Common Income
Select Miscellaneous Income.
Select “Other reportable income”, click ‘Yes’ and you will be prompted to enter Description and amount. Please be sure to write a short explanation and enter the amount as a negative number. At this point, the form 1040 will show full amount as taxable AND as a negative adjustment on line 21. The end result: form is reported but not taxable.

If box 7 reports the stipend, you would have to report it as self-employed income, then enter the same amount as your "business" expense. This will ensure that form 1099-MISC is reported for matching purposes, but the amount is not taxable as self-employment income.

1. Federal Taxes

2. Wages and Income

3. Self-Employment , Select Income and Expenses - follow the interview questions; you would report the stipend as if you own a business; once general questions are answered, you would enter the stipend as an expense (you can create your own description). The end result: form 199-MISC is reported, but the income is not self-employment income, because it shouldn’t be.

REPORT STIPEND INCOME CORRECTLY

To report stipend income in Turbo Tax, you must visit Deductions and Credits, Education Expenses section. You must answer all the questions, the taxable amount will be computed as the excess of your scholarship over the qualified education expenses.

Federal Taxes
Deduction & Credits
Scroll down to Education
Select Expenses and Scholarships
Follow the prompts… It will be somewhat confusing as you are answering the questions as if you claim an education credit… answer the initial questions and select that you did not receive form 1098-T. You will be asked for school’s name and address, just fill out the program information you are in... You will eventually see a screen "Did (your name) receive a scholarship or grant in 2016? Please enter your stipend in other Scholarships/Grants/Fellowships; this will ensure that the stipend is taxable on line 7 form 1040 as wages.

Once done, you may review your form 1040 and to verify that line 7 of the form looks correct. You may do so prior to paying for the program:

From My Account drop down, select Tools (you must be logged into your tax return)
Select View Tax Summary
Select Preview my 1040

Ahhhh, the "negative" number. I missed that. Thanks.

PhD_student — Sat, 01 Jun 2019 08:28:03 GMT

Ahhhh, the "negative" number. I missed that. Thanks.

[deleted]

PhD_student — Sat, 01 Jun 2019 08:28:05 GMT

[deleted]

I have stipend on Box 7 in 1099-MISC. So I try to follow...

hong-ma2 — Sat, 01 Jun 2019 08:28:06 GMT

I have stipend on Box 7 in 1099-MISC. So I try to follow the steps outlined above. But I can not get to "Self-Employment , Select Income and Expenses " under "Wages and Income". Why?

The instructions make sense, but I have one follow-up que...

msgoldblatt — Sat, 01 Jun 2019 08:28:08 GMT

The instructions make sense, but I have one follow-up question. In the section "Report Stipend Income Correctly" it's noted that in the "Select Expenses and Scholarships" section to answer the initial questions and "select that you did not receive form 1098-T". But in my case, I did receive a form 1098-T, which reported a Scholarship received for Tuition. So where you note to "enter your stipend in other Scholarships/Grants/Fellowships, to ensure that the stipend is taxable on line 7 form 1040", do I instead say that I did receive form 1098-T, and then enter both the Scholarship AND the stipend in that section? Would that mean that both the scholarship and the stipend would then end up on line 7 of form 1040?

topic 1099-MISC - Educational Stipend in Get your taxes done using TurboTax

1099-MISC - Educational Stipend

The fact that you have 1099-Misc slightly complicates the...

Ahhhh, the "negative" number. I missed that. Thanks.

[deleted]

I have stipend on Box 7 in 1099-MISC. So I try to follow...

The instructions make sense, but I have one follow-up que...