1099 NEC and gift cards

[Mfurstoss]

I work as an insurance agent and received over $600 in gfit cards as part of an incentive from one company. I understand this has to be reported. Do I put the work description as insurance services, or gift cards? It asks if I started or stopped in 2021... how do I answer that? I only received gift cards during 2021 as this was the incentive period which ended 12/31/21... but I began insurance many years ago. It also asks was an active particpant, how do I answer that?

What was a great incentive just turned very complicated.

[Critter-3]

If you are a wages employee then these are a kind of "spiff" and is reported as other income :

• Down the left side of the screen, click Federal.
• In the center of the screen, click Income & expenses.
• On the screen Your income and expenses, scroll all the way down to the last section, Less Common Income.
• Click the Start or Update button for the last topic, Miscellaneous Income, 1099-A, 1099-C.
• On the next screen, Let's Work on Any Miscellaneous Income, scroll down and click the Start or Update button for the last topic, Other reportable income.
• The next screen asks, Did you receive any other taxable income. Click Yes.
• On the next screen, Other Taxable Income, enter a description and the amount. Click Continue.
• On the next screen click Done.

The income will be reported on Schedule 1 line 8 with the description that you entered. 

[Mfurstoss]

I am a salary employee for the agency I work for, this was gift cards from a company we represent. So I do not list it as an NEC at all, just "something else?" Just want to make sure I understand correctly since I received the 1099 NEC. Thank you!

[Bert2786]

Hi

I have this exact same scenario…this reports on 1099-NEC…but when you go through those prompts..it seems to go through like you are a business owner..but basically these are just gift cards given to us by a carrier that is not our employer..so what is the correct way to file this? 

[ColeenD3]

Yes, report it the way described by @Critter-3. I would reference that it is a SPIFF (very important) and that it was incorrectly reported on a 1099-NEC. That way the IRS can match it with the 1099.

[Bert2786]

Okay, thanks for response... I don't believe the 1099-NEC form is a mistake by the carriers.. as they were on the same forms as last year.  But it looks like something is different in the software this years as it is treating the income as a  business owner... and i see last year this income went under the "Miscellaneous" category, but this year around doesn't seem to be recognizing that.. But if the way you say is the correct way I will try it... But the IRS gets sent a 1099-NEC for this income earning.