1099 misc

[Welo]

I received two 1099misc that turbo tax wants to use as a business, which we do not have. One is for being a hobby author and the other is for capital credits earned from a telephone co-op in 2007 & 2008. How do I enter them so they are not treated as a business.

[DawnC]

If the income is in Box 3 for both of them, follow these instructions for each 1099-Misc.  
 

1. Sign in to your TurboTax account.  Or open your return
2. Select Federal from the left side menu (if using TurboTax Online).
3. Type 1099-Misc in the search bar and click on Jump to 1099-misc.
4. On the Did you get a 1099-MISC? screen, select Yes.  If you come to the 1099-MISC Summary screen, select +Add Another 1099-MISC located under the Total.
5. On the Let’s get the info from your 1099-MISC screen, enter the information on the form and Continue.  ($ should be in Box 3)
6. On the Describe the reason for this 1099-MISC screen, enter a description (hobby author / capital credit).
7. On the Does one of these uncommon situations apply?  select any option and continue with the onscreen interview until complete.
8. If you select None of these apply, you have a few more questions to enter.   Keep going.
9. On the Did the XXX involve work that’s like your main job? screen, select No, it didn’t involve work like my main job.  If it’s like your main job, this may be self-employment income.
10. On the How often did you get income for XXX? screen, select I got it in 2021.  Note: If you have done this work in the past and plan on doing this in the future, this may be self-employment income.
11. On the Did the XXX involve an intent to earn money? screen, select No, it didn’t involve an intent to earn money and Continue.  Note: An intent to earn means obtain (money) in return for labor or services with the intent of making a profit.

The income will appear on Line 8 of Form 1040, not subject to Self-Employment Tax, but it will be subjected to ordinary income tax.   If the income was previously entered elsewhere, delete the other entries.   

[bjdeegan]

The money on my daughters 1099 Misc was not part of a Schedule C business she started.  She simply accepted an internship while in college and was paid for the work that she did while working remotely from home.  TurboTax is forcing me to give details on a business that was never created.  The employer decided to pay my daughter on a 1099 basis with no tax withheld.  I understand it needs to be reported but I don't have any Sec.199A business code for an internship??  Why does this force me to do so?

[PatriciaV]

Unfortunately, because this was an intent to make money (paid intern), the IRS considers your daughter to be "self-employed." You can use business code 999999 for this income.

Also, if she had any expenses related to her internship, be sure to report these to reduce the income that will be taxed.

Read more here: 

• Beginner's Tax Guide for the Self Employed 
• Tax Tips for the Self-Employed

[bjdeegan]

Thank you very much.