1099-MISC input for Paid Leave Oregon- Input for no Schedule C

[noellematthews]

I have been on the phone and on my computer for hours trying to figure this out, so hoping someone else finds this and it helps them. I was on Paid Leave Oregon for the end of 2025 and beginning of 2026. I received a 1099-MISC from the Oregon Employment Department, and I called to confirm from them that this was the correct form (on Turbo Tax's "expert" request- they thought the state sent me the wrong thing?? sure.).

When I went through all the prompts to enter the 1099-Misc, no matter what I did it would turn it into self-employment, adding a schedule C and taxing me at a MUCH higher rate. I half considered entering it as a 1099-G so it would be taxed correctly, but did not want to knowingly do something incorrect... after hours of searching message boards I FINALLY found the issue.

Here are the steps:

1. Enter in the 1099-misc info

2. Describe the reason for this 1099-MISC: "Paid Leave Oregon" (or whatever leave/program it is for)

3. Do one of these uncommon situations apply?: Click "None of these apply"

4. Did the Paid Leave Oregon involve work that's like your main job?: Click "No, it didn't involve work like your main job"

5. How often did you get income for Paid Leave Oregon? THIS IS THE IMPORTANT STEP THAT KEPT MESSING ME UP, AND THE ONLY WAY TO GET IT TO TAX PROPERLY. You absolutely MUST only click the box "You got it in 2025." you can't click for 2024 or 2026 (or past/future years, whenever you're reading this). On this page the only year that matters is the year that is listed on the 1099-MISC. If you click anything additional, the system borks up and counts it as Self Employment and brings in a schedule c, which will tax you more. 

This was an ABSOLUTE NIGHTMARE EXPERIENCE and it is crazy that of the 5 "experts" I spoke with, none of them knew this was a problem. Anyway, hope this helps someone out there!!

[Baileysh1]

I have been through the same nightmare! I spent countless hours on the phone with TurboTax  “experts,” but they can’t explain why the amount of federal tax due increases 11 times after I answer the question Did the Paid Leave Oregon involve work  like your main job? I answered no, but the minute I hit the continue button, my federal tax due skyrockets.  I also answered only 2025 to the question. How often did you get income for paid leave Oregon.  So I am still in this nightmare.  TurboTax is just telling me I need to pay for a tax expert.  Any other suggestions/solutions would be much appreciated!

[DianeW777]

Yes, you are correct. This is not self employment income and should be reported by using the steps below. Once completed this will move the income to the Schedule 1, then the 1040. You may need to delete the Schedule C. Steps are similar as provided above, but follow them carefully.

1. TurboTax Online/Mobile > Search 1099misc > click See more > click the highlighted 1099-MISC
2. TurboTax Desktop > Search > 1099-MISC > Click the Jump to.. link
3. Enter the 1099-MISC exactly as printed, and then Continue
4. Enter Paid Family Leave
5. Select None of these apply, then Continue
6. Select No, it didn’t involve work….. and Continue to 'How often did you get income for Paid Family Leave?'
7. Select ONLY the tax year for which this specific 1099-MISC was issued. 
8. Do not select the year that you received the 1099. Select the year for which the 1099-MISC was issued. Select no other year. 
9. Select No, it didn’t involve an intent to earn money, then Continue
10. Select NO, then Continue
11. Click the DONE button 
This will complete the entry and you can continue to work on your tax return.

@Baileysh1 
 

[rockhillranch]

The reason this increases the tax so much is, if you can't convince TurboTax that this is NOT self employment, then the program is going to add BOTH federal tax withholding and "payroll taxes" (FICA and Medicare).  It is the self-employment "payroll taxes" that make the difference -- these are, ordinarily, held out by an employer but are required to withhold for self-employed taxpayers. 

AM Smith