Hello. I received 1099-Misc and entered in turbo tax as income. But turbo tax categorized it as business. It's not business actually, because I am only an employee of a certain business entity. How do I correct the particular entry in turbo tax?
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If you are working for a business and you're not receiving a paycheck with taxes deducted and not getting a W-2 in January then you would not be considered an "employee" and the the business you're working for would not be considered an "employer." If you're being paid for your work with no taxes withheld from the pay and you receive a 1099-MISC in January with dollars in Box 7 - "Nonemployee compensation" - the you are considered to be an "independent contractor" and the entity paying you is one of your "clients."
Accordingly you are considered a "business" and must file a tax return as such, using Schedule C. At least, that's the default position that you're in.
Many businesses try to pay their workers as independent contractors instead of employees in order to save money even though, legally, they relationship is actually one of employer/employee. Essentially the distinction between independent contractor and employee comes down to the amount of control the business has over you. If they tell you when to show up, what to do, where to go, what days you'll be working, tell you if you can take time off, etc., etc., etc., then you might really be an "employee" and should be receiving a net paycheck as well as a W-2 instead of an "independent contractor receiving a gross paycheck and a 1099-MISC.
I'd advise you to read this:
and see if you need to, or want to, take some action here.
If you are working for a business and you're not receiving a paycheck with taxes deducted and not getting a W-2 in January then you would not be considered an "employee" and the the business you're working for would not be considered an "employer." If you're being paid for your work with no taxes withheld from the pay and you receive a 1099-MISC in January with dollars in Box 7 - "Nonemployee compensation" - the you are considered to be an "independent contractor" and the entity paying you is one of your "clients."
Accordingly you are considered a "business" and must file a tax return as such, using Schedule C. At least, that's the default position that you're in.
Many businesses try to pay their workers as independent contractors instead of employees in order to save money even though, legally, they relationship is actually one of employer/employee. Essentially the distinction between independent contractor and employee comes down to the amount of control the business has over you. If they tell you when to show up, what to do, where to go, what days you'll be working, tell you if you can take time off, etc., etc., etc., then you might really be an "employee" and should be receiving a net paycheck as well as a W-2 instead of an "independent contractor receiving a gross paycheck and a 1099-MISC.
I'd advise you to read this:
and see if you need to, or want to, take some action here.
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