You will report the hobby income per the 1099-NEC then report the reimbursement as a negative amount for other reportable income.
To enter your 1099-NEC as hobby income in TurboTax Online please follow these steps:
- Go to the Income & Expenses section of your tax return
- Click Edit/Add for your form 1099-NEC
- Input the details of your 1099-NEC and click Continue
- Answer the questions and Continue until you get to the Does one of these uncommon situations apply? page
- Choose This is not money earned as an employee or self-employed individual, it is from a sporadic activity or hobby (this is not common) and click Continue
- Scroll down the Wages and Income page and select Less Common Income
- Select Start next to Miscellaneous Income, 1099-A, 1099-C
- Scroll down to Other reportable income and select Start
- Choose Yes on the Any Other Taxable Income? screen
- In the Description field, enter Form 1099-NEC reimbursement amount
- In the Amount field, enter your reimbursement as a negative number, select Continue and then Done