1099-misc

[datsun4]

Hi,

My husband receive a 1099-misc when he broke his leg at work.

Turbo Tax keeps asking me for the reason. Do I just put broken leg?

I don't know how to answer it as none of their options apply.

Any help anyone could give me would be greatly appreciated.

Thank you for your time.

[MelindaS1 · Accepted solution]

If this is a workers' compensation payment, it is 100% nontaxable at the federal and state level, and you should not have received a 1099 for this as "income". Is the amount in box 6? If so, that's a good sign you shouldn't have received this at all. If this is workers' comp, you may need to file an extension of your tax return, and then contact your state workers' comp office to get this worked out: ask them to send a corrected 1099-MISC with 0.00 income. 

Reminder - filing an extension of your tax return, does not extend the deadline for payment. If you extend, you can get more months to send in your tax return forms without penalty, but you should make any tax payment you anticipate before the deadline in April.

[datsun4]

Hi MelindaS1,

Thank you your quick response.

The amount is listed in box 3.

Every other box on the 1099-misc is blank.

I am at a loss as to what to do. I'm confused.

Any advice on this.

Thank you again for your time.

[datsun4]

Hi again.

My apologies. I forgot to state that this was a worker's comp.

Thank you again.

[LindaS5247]

Workers' compensation  received  for an injury like a broken leg is generally not taxable at the federal or state level. Compensation for physical injury/sickness is generally tax-free.

Because of this, it is not usually reported in Box 3 of a Form 1099-MISC and it should not be included in your gross income on your tax return.

If this is the case, it appears your Form 1099-MISC was issued incorrectly and you should contact the issuer of the form to get a corrected one.  If they confirm that this is the case, you likely will not have to report this on your tax return. But you should get a corrected form so the IRS knows it was not taxable.
 

If you are unable to file by April 15 because of this issue, you can request an extension to file your tax return at that time.

To apply for an extension in your TurboTax program you can do the following:

1. Click on the search icon in the upper right of your TurboTax screen
2. Type "extend" in your search box
3. Click on the link "Jump to extend"
4. Your screen will say "Applying for an Extension"
5. Answer "Yes" to the question "program,"
6. Select "Continue"
7. Follow the TurboTax screens and answer all of the follow-up questions

Click here for How to File a Tax Extension: A Step-By-Step Guide

You can also click this link federal tax extension to start an extension for your federal income tax return.

Please return to Community if you have any additional information or questions and we would be happy to help.