1099-Misc

[margosomar]

My Husband is retired but still pays union dues; because he still pays his union dues he is entitled to a Christmas Bonus.  This amount is reported on a 1099-Misc Box 3.   When I input this into your Turbo Tax; the system is recoreding  it under Sch 1 on line 3 "Business Income".   He does not have a business; this is extra income from his union dues just because he is still considered a member of the union.  How do I get this into Sch 1 line "other income". ????

[AamilD]

Please follow the steps below to enter tour 1099-MISC:

1. Click on Tax Home from the Left side Menu.
2. Click on Wages & Income from the main screen.
3. Scroll Down till you see the section for "Other Common Income". Within this section, you will find Form 1099-MISC and you can enter the information accordingly.

When you use this method, it will not ask you about any business information.

[margosomar]

That is where I entered the info off my 1099-Misc but it keeps treating this income as if it had something to do with Business.  The funds received/reported on 1099-Misc was a bonus from the Union my husband belongs to.  MY HUSBAND IS RETIRED (DOESN'T WORK, DOESN'T HAVE A BUSINESS) !!

[margosomar]

What am I doing wrong???? I answered the questions TurboTax asked me to. 

[KrisD15 · Accepted solution]

If this is not Self-Employment, and not wages, enter it as "Other Income" reported on Schedule 1 and carried to your 1040 line 8. 

Go to the Wages & Income section 

Scroll down to "Other Common Income" and click Show more

Scroll down to "Income from 1099-MISC"

Enter or Edit the 1099-MISC

Enter "Gift" as description

Select "None of these apply"

Select "No, it didn't involve work"

Select "got it in 2021" ONLY, even if he gets it year after year. This is a TurboTax worksheet question to determine if it's Self-Employment income, and it isn't

Select "No, it didn't involve an intent to earn money"

[Bugsme]

This appears to be a bug.

I had to bring up forms and make an adjustment in the forms to get rid of this business endless loop. I went through it about 4 times before I realized what was happening.

Bring up form 1099 MISC in the forms (view --> forms or CTRL-2)view. Under Box 3 other income there is another sub-box on the form for "other income". Check this box and remove the description for the "Schedule C" line. There will also be a selection box for removing the link. When you remove the link it will remove the entries in the business items section. You may have noticed the "income" showing up there as well.

Good Luck - Sorry if this was not precise I am going from memory. I also noticed that there are a lot of steps being skipped. I usually find a couple bugs every year... For some reason this year there seems to be a lot of them.  I have found a lot of bugs in the software. It appears Turbotax is cutting back on experienced testers to save money. 

[LenaH]

If bonuses are reported on a 1099-MISC, then you will still need to pay the uncollected Social Security and Medicare tax, as well as the income tax. This could be why it is populating under your Schedule C and adding self-employment tax (which will end up being your portion of the Social Security and Medicare on this income). 

The IRS classifies bonuses as supplemental wages, along with severance pay, taxable fringe benefits, vacation pay, and back pay. 

Per the IRS, supplemental wages are subject to Social Security and Medicare taxes. 

For more information, please see IRS Publication 15.

@margosomar

@Bugsme

[Bugsme]

Not sure what the original posters issue was for.

In my case the 1099-Misc was from my brokerage for a payment from an ETN that I had owned. It was not income from a business or an employer. 

I think you are missing the point of the original issue. There is no way to select "other" in the guided screens. They left it off for some reason. Why?  You have to go to the tax forms to select "other".

I hope that helps.

Thanks for your time and sorry if it was not clear what the issue was.

[Bugsme]

I just read the original posters reply - You could be correct in that case. That should be different from my issue. I am guessing it is how the union payment is defined.

I was looking at how the software was working not at the actual issue. It could be that if people are blindly relying on the software, they could be reporting Unearned Income as Earned Income and as you stated, paying extra taxes.

Unearned income is an IRS term for income that is not obtained by participating in a business or trade (e.g., salaries and bonuses, wages, commissions and tips). It typically includes interest, dividends, pensions, social security, unemployment benefits, alimony and child support.