1099-MISC

[CarlJaneUnbehaun]

I got a 1099-MISC.  I work for a company that sells and rents construction equipment.  In box 1, our franchiser reported a bonus for rental sale.  I am not self-employed, but are they trying to say that I am for tax purposes?  Can I just enter the amount on line 8 of the 1040?

[MinhT1]

The payments from that company reported on the form 1099-MISC are SPIFF payments.

These payments (1) are not treated as wages, (2) are not subject to federal income tax withholding, social security, Medicare, or federal unemployment tax, and (3) are not considered to be self-employment income and, therefore, are not subject to self-employment tax.

They are reported as Other reportable Income.

In TurboTax Online, open your return and follow these steps:

1. Click on Federal in the left-hand column, then on Wages and Income on top of the screen
2. Scroll down and locate the Miscellaneous Income section
3. Enter your form 1099-MISC and describe the payment as SPIFF
4. On the page titled Do one of these uncommon situations apply?, choose This was a manufacturer's incentive payment and click Continue

See also Hal_Al's answer.

Edited 03/02/26 | 6:01 AM PST

[Hal_Al]

Yes.  You have a SPIFF. This is a common situation and TT can handle it.

In TurboTax, Enter at:

- Federal Taxes tab

 - Wages & Income

Scroll down to

  -1099-Misc and Other common Income

      - Income From 1099-Misc

 On the  follow up screen :"Describe the reason for this 1099-Misc",  enter SPIFF in the blank box, then on the next screen,  "Does one of these Uncommon situations apply" on the drop down list, check “This was  a Manufacturer's incentive payment”

This will put it on line 8z of Schedule 1 then line 8 of form 1040.

A SPIFF (Special Performance Incentives for Field Force) is a small, immediate bonus for a sale. Typically, "spiffs" are paid, either by a manufacturer or employer, directly to a salesperson for selling a specific product.

IRS Publication 3204 discusses spiffs for the auto industry, however the principal should apply to any spiff. 

SPIFF payments reported on Form 1099MISC; (1) are not treated as wages, (2) are not subject to federal income tax withholding, social security, Medicare, or federal unemployment tax, and (3) are not considered to be self employment income and, therefore, are not subject to self employment tax. 

https://www.unclefed.com/IRS-Forms/2005/p3204.pdf

The entry method described by @MinhT1 also works.