If you did not have to return the money not used for equipment and such, then this would still be for compensation for services as well.
So, what you will do is enter it as a 1099-NEC as self-employment and then deduct your expenses from the payment as well.
To enter your self-employment income click the following:
- Federal
- Income and Expenses
- Show More next to Self-Employment
- Start next to Self-Employment
- Yes, to you have any self-employment income or expenses
- Enter the type of self-employment work you do and you can select that you use your name for your business
- Click through a few more screens and you will get to a screen that says "Your XX info"
- Click Looks good
- Then you will come to a screen that says Let's enter the income for your business. It will give you the option of 1099-NEC or Other self-employed income including the 1099K , cash and checks. Here is where you will enter your 1099
- If you do not select one, it will not let you enter your income
- Enter your self-employment income on the next screen
- Continue and on the next screen click add expenses
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