topic How to report freelance income in Get your taxes done using TurboTax

How to report freelance income

jbphillips99 — Mon, 09 Mar 2026 06:48:10 GMT

I did a freelance job last year where I did some work, and some was just as a middleman.

the check that was written to me was for $14k, but I turned around and wrote a check to someone else for $10k to execute their part of the work. So i really only made $4k on the job.

How do I report that? because I took in the 14, but the 10 was a cost of goods to get the job done, and was never really in my pocket.

Re: How to report freelance income

VolvoGirl — Mon, 28 Mar 2022 23:37:16 GMT

Yes that is self employment income. You need to file schedule C in your tax return. You enter the full amount of income you received then you can expense the person you paid. That is Contract Labor on Schedule C line 11.

You need to give a 1099NEC to anyone you paid $600 or more to for the year. But not to corporations or for merchandise. You send the IRS a copy of the 1099Misc with the transmittal summary form 1096. These are due to the person by Jan 31 and to the IRS by Jan 31 also.

To prepare W2 and 1099s you need either the online Self Employed version or the Desktop Home & Business program or the separate Desktop Turbo Tax Business program.

To prepare W2s and 1099s in the Online Self Employed version you have to first start your personal return. Then when you log in you select Take me to my Return. Then the next screen should be the Welcome Back screen. At the bottom under Manage your Return it says Create W2s and 1099s. This will take you to the QEF Quick Employer Forms.

If you are already in your return you can log out and back in again to get to the beginning screen.

Re: How to report freelance income

VolvoGirl — Mon, 28 Mar 2022 23:39:26 GMT

Did you get a 1099NEC for the 14,000?

To report your self employment income you will fill out schedule C in your personal 1040 tax return and pay SE self employment Tax. You can enter Self Employment Income into Online Deluxe or Premier but if you have any expenses you will have to upgrade to the Self Employed version. Or any of the Desktop programs. But you will get the most help in the Home & Business version.

How to enter income from Self Employment
https://ttlc.intuit.com/community/self-employed/help/how-do-i-report-income-from-self-employment/00/26653

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment. You pay 15.3% SE tax on 92.35% of your Net Profit greater than $400. The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare. So you get social security credit for it when you retire. You do get to take off the 50% ER portion of the SE tax as an adjustment on 1040. The SE tax is already included in your tax due or reduced your refund. The SE tax is in addition to your regular income tax on the net profit.

Here is some IRS reading material……
IRS information on Self Employment
https://www.irs.gov/businesses/small-businesses-self-employed/self-employed-individuals-tax-center

1040 Schedule C Instructions
https://www.irs.gov/pub/irs-pdf/i1040sc.pdf

Publication 535 Business Expenses
https://www.irs.gov/pub/irs-pdf/p535.pdf

Re: How to report freelance income

jbphillips99 — Tue, 29 Mar 2022 00:57:51 GMT

thank you for your thorough answers.

I'm using the desktop deluxe application, and was able to enter the income and log the 10k as an expense (cost of goods sold) so that it reflects just the 4k of income.

I did not receive a 1099-NEC to my knowledge, though I've reached out to see if they can provide such a thing.

any my taxes owed certainly went up, so i'm imagining that I've accounted for it all correctly? just need to generate a 1099 for the people I paid (understanding that should have been done by 1/31). though do I need to do that if the people I paid were an LLC? does that qualify as a corporation meaning I don't have to create such a thing?

Re: How to report freelance income

VolvoGirl — Tue, 29 Mar 2022 01:17:49 GMT

You don't need to get the 1099NEC. You should enter your income from your own records.

No it is not cost of goods sold. Do you keep an inventory? It should be Contract Labor.

Go to Federal Taxes Tab

Wages and Income

Choose Jump to Full List -or I'll choose what I work on

Then scroll way down to Business Items

Under Business Expenses, Click Start or Update by Other common business expenses. You should see the list of expenses and amounts you entered.

Then click the start or update button by the expense you want to add or edit.

Contract Labor is the 5th item under Expenses - Click the Start or Update button

Re: How to report freelance income

jbphillips99 — Tue, 29 Mar 2022 01:27:01 GMT

awesome. that makes much more sense.

verified that the people I paid are an LLC. so I need to create a 1099 for that and file it and a 1096 with the IRS, correct? and apparently those need to be physical forms?

Re: How to report freelance income

jbphillips99 — Tue, 29 Mar 2022 01:50:27 GMT

nevermind. think I figured out how to use the quick employer forms. and now have the info in the correct places on my return.

thank you for your help. you're my hero. 🙂