reimbursement of American Express fees via Morgan Stanley is reported on 1099-MISC. What is the correct explanation of the $695?

[SharonD007 · Accepted solution]

You can put "Reimbursement of Fees" for the explanation.

You can enter the income as “Other Income” so it won’t be subject to self-employment taxes.  Follow the steps below:

1. Open TurboTax
2. Select Federal Taxes
3. Select Wages & Income
4. select Start by Form 1099-MISC under Other Come Income
5. Select Yes to Did you get a 1099-MISC?
6. Follow the prompts to enter your 1099-MISC
7. Enter the reason: Reimbursement of AMEX fees to Describe the reason for this 1099-MISC
8. Select None of these apply to Does one of these uncommon situations apply?
9. Select No to it didn’t involve work like your main job
10. Make your selection to How often did you get the income?
11. Select No to Did it involve an intent to earn money?

For additional information, review the TurboTax articles What's the difference between self-employment income and other income? and Where do I enter a 1099-MISC?

[maricris8]

ERROR with TurboTax system: When trying to enter complete this 1099-MISC section for this AMEX fee rebate, here is the hang-up. It asks me if I've received it in previous years, and do I expect to receive it again in 2025. When I check the boxes stating I received in in previous years and expect to receive it in 2025 (which is true - I've already received it this year,) it AUTOMATICALLY pushes me to being self-employed as asks me to state my "new employment." When I uncheck those boxes, it moves forward as normal. But then it's "inaccurate" data, and I don't want to get in trouble for inaccuracies. How do I get around being tagged as "self-employed" while still reporting that I've received it in the and will receive it again this year?

[DianeW777]

You are correct, it is not self employment income. It is still accurate data because the form for 1099-MISC is not a required entry to file your return, it can be entered as 'Other Income'.  For most, the form entry is easier to follow, however due to the change with Form 1099-NEC being used, it's important to ask all the questions because some payers still use the wrong form for self employment.

You can have confidence in filing your return because the key is for accurate income reported correctly and you have accomplished that.

@maricris8