Can the person I worked for count expenses I paid on their behalf as income on my 1099 ? I paid for their expenses for his business on my credit card and got reimbursed.

[jillblairturner]

The expenses are great not just a little bit.  Apron $56,000.  I am a new contractor and had no idea this would happen or I would have never paid for their expenses.  How do I handle this on my taxes so I don't have to pay for that amount as income because it clearly was not.

[ShirlynW]

Yes. Have the client to include the amount on the 1099-MISC and deduct the amount paid for as business expenses.

[jillblairturner]

Thank you Shirlyn for answering my questions.  Where to I claim it so that it is 100% deductible.  This seem kinda unfair to the contractor.

[JohnB5677]

You are using the Self-Employed software.  You can deduct it as a supply expense on you Schedule C.  Then the $56 will not be taxed.

[jillblairturner]

Hi, John B

When I put in the full amount on my 1099 and then included the $56K in supplies my refund amount did not change.  Does the mean I did it wrong and am being taxed on the $56?  How do I verify I am not being taxed?

Thank you in advance!

Jill

[JamesG1]

You should be creating an expense category and reporting the expenditure.  If the $56,000 is included as income in your self-employment activity, you should see a change in the balance due or refund.

If the $56,000 is included as income in your self-employment activity. add an expense category and report the $56,000 as an expenditure against self-employment income.  Follow these steps:

• Down the left side of the screen, click on Federal.
• Down the left side of the screen, click on Wages and Income.
• Scroll down to Self-employment.  Click Show more.
• Click on Start / Edit / Add to the right of Self-employment income and expenses.
• At the screen Here's your info, scroll down the expenses and click Add expenses for this work.
• Add Other miscellaneous expenses to report the $56,000 expenditure.

@jillblairturner