Tax Year Prior to 2020: 1099-k

Forum|Forum|6 years ago
February 16, 2020
1 reply
9 views

I received the refund of a security deposit for my old apartment and on PayPal which has issued me a 1099-k form. My understanding is that I have to file it, my point is: the transactions on the form is not technically "income", what is the correct way to deal with it?

ColeenD3

Level 15

A returned security deposit is not income. It was your money to begin with. However, if the money was returned to you with interest, the interest would be taxable. (Some states require landlords to pay interest on security deposits.)

Since the only way to include it and then dispose of it as an exprense is by entering it on Schedule C, that is what you will need to do.

matbakAuthor

Level 2

Thank you very much Coleen!

What should I enter as "type of self-employment" on TurboTax?

ThomasM125

Level 15

You do not need to report the refund, except the part that is interest. It is fully taxable and needs to be entered as a form 1099-INT entry in TurboTax as follows:

1. Go to the "Federal" section of TurboTax

2. Click on "Income and Expenses"

3. Find "Interest and Dividends"

4. Click on "Interest on a 1099-INT"

5. Click on the "Start" button or "Update" button next to it

6. Click on the option "I'll type it in myself"

7. Enter the name of the company that paid you and enter the interest amount received

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