topic Re: 1099-NEC in Get your taxes done using TurboTax

1099-NEC

mgironda1 — Tue, 26 Jan 2021 15:30:19 GMT

I'm part of a teacher program in my state where we receive stipends twice a year. We are expected to complete 50 hours of professional development, which includes attending meetings, workshops, and other events in order to receive the stipend. I used to receive a 1099-MISC for this and have gotten my taxes done via an accountant the past couple of years. My tax situation hasn't changed, so I'm just looking to save money!

I'm unsure how to file this with TurboTax. I don't own a business and I don't know how to classify this 1099-NEC form (second job, "other," etc.). The check comes directly from the state comptroller's office.

Any ideas on how I can do this properly?

Re: 1099-NEC

ToddL99 — Tue, 26 Jan 2021 16:08:01 GMT

Since these payments are directly related to your main work or career (teaching), you will have to report them as "business income" on Schedule C - Profit or Loss from Business. This is the only place you can properly report payments made to you on Form 1099-NEC.

Any net profit from Schedule C is subject to both income tax and employment taxes. If you use the online TurboTax Self-Employed program (Home & Business if CD/Download), you can claim the expenses you incurred to generate this income. Examples of those expenses would be meeting, workshop or conference fees, mileage to attend those event and supplies.

How to File Taxes with IRS Form 1099-NEC

By using the online TurboTax Self-Employed program (or Home & Business CD/Download), you can claim expenses and eliminate or reduce any tax due on the Form 1099-NEC income.

Re: 1099-NEC

mgironda1 — Tue, 26 Jan 2021 16:20:13 GMT

Ok. My wife and I pay estimated taxes each year because it's a large stipend that goes untaxed. I just wanted to make sure the program was understanding this correctly. Thanks!

Re: 1099-NEC

mgironda1 — Tue, 26 Jan 2021 20:24:26 GMT

When I look over my return from last year, there were attached federal statements totaling the income and describing them as stipends. Does TurboTax auto generate this statement?

Edit: Past years it has been under "Part 1: Additional Income, Other income" on my 1040 form and not Schedule C.

Re: 1099-NEC

Irene2805 — Wed, 27 Jan 2021 16:41:54 GMT

Yes - TurboTax will generate supporting statements for different types of income entered.

The IRS stated that, starting in 2020, nonemployee compensation is to be reported on Form 1099-NEC, rather than 1099-MISC. That is why the Schedule C is generated and included in your 2020 return.