California State Tax is counting my 1099-MISC INCOME twice and I'm paying more tax.1

[marko1n]

Hi There,

I have a 1099-MISC income.  I was hired to tutor students remotely and earned $1,200 for the year from my residence in California.  On my California income state tax the $1,200 is being shown as Federal Income and State income and being added together to total $2,400.  It is only $1,200.  On the State Form CA 540NR, Section B Additional Income, Line 10 it is adding the $1,200 twice and totalling to $2,400.  This should only be $1,200.  This is causing me to pay twice as much in taxes.

Also, why is Turbo Tax causing me to record this 1099-MISC income as a self employed business?  I was hired as a tutor.  I need to pay taxes on the income, but the income was paid by an employer who hired me.

Thanks,

Mark

[RobertB4444]

When you are paid as a contractor then you are considered self-employed.  Even though you are doing work for someone else you are the one in charge of your schedule and things like that.  So you are considered self-employed for that reason.

If the amount from your 1099-MISC is appearing twice then you may have entered it a second time in relation to your state return.  The only place that you should enter the amount you received is when you entered that 1099-MISC form.  If you entered the amount anywhere else then you need to go back and delete it.

@marko1n 

[marko1n]

Thank you, I will try.  Where should I enter the 1099-MISC?  Under self employed?  Or 1099-MISC?  It is showing up in both right now.  I entered it in 1099-MISC.

Thanks,

Mark

[MonikaK1]

A Form 1099-MISC should be reported only in that section, unless you have a long-term arrangement as an independent contractor, in which case the income should only be reported on Schedule C.

If you are working on a continuing basis for the payer then you should probably be treated either as a W-2 employee or as an independent contractor and issued a Form 1099-NEC, in which case you would report the income and any deductible expenses on Schedule C. You could bring this up with them.

See this help article for more information.

@marko1n

[marko1n]

I am having trouble with finding where to select OTHER INCOME on Schedule 1 of my Federal 1040 form?  I do not have a business.  This 1099-MISC I received I want to record as OTHER INCOME.  The Turbo Tax software shows selections that fit some of the questions, but I can't locate where to report this as OTHER INCOME?  It keeps stating I have a business which I do not.  Can you point me what to click to select OTHER INCOME for Schedule 1 of my Federal 1040?  This error is causing my state to have issues which I thought was the problem previously in my questions.  Thanks, Mark

[marko1n]

Here is the answer on TT

o enter a 1099-MISC, that is for miscellaneous income, not for self-employment or rental income, follow the steps below.

Under Other Common Income, select Start or Revisit next to Form 1099-MISC.   Enter your 1099-MISC info on the Let's get the info from your 1099-MISC screen and click Continue.  

1. On the Describe the reason for this 1099-MISC screen, enter a description of the income.
2. Click Continue.
3. Select None of these apply on the Does one of these uncommon situations apply? screen.
4. Select No, it didn’t involve work like my main job on the Did the involve work that's like your main job? screen.
5. Select I got it only in 2024 on the How often did you get income for? screen.
6. Select No, it didn’t involve intent to earn money on the Did the work involve an intent to earn money? screen.
7. Select No on the Do you have another 1099-MISC? screen.

Answering differently to any of these questions will imply self-employment and generate Schedule C.