1099-NEC Buyer Commission Rebate

[nathantruong83]

I've recently bought a new house and the real estate broker cut me a check of $4K after closing as a buyer rebate. I've recently received a 1099-NEC from him. As my understanding, if the rebate is issued out of the closing table, then it is taxable as my income. Is it true? Does it consider as a self-employment tax and it is higher than my regular W2 tax?

Best Regards,

Nathan

[LinaJ2020]

It is taxable to you but should not be self employed.  Here are the steps how you enter the 1099-NEC:

In TurboTax online, 

• Sign into your account, select Pick up where you left off
• From the upper right menu, select Search and type in 1099nec and Enter
• Select the Jump to 1099nec
• Follow prompts to complete the section
• On screen, "Does one of the these uncommon situations apply?"  Select None of these apply to me 
• Next screen, " You can deduct expenses for your work", select No

The amount will show on line 8 of Schedule 1 and Form 1040 as Other Income.

[nathantruong83]

Which TurboTax version should I use? Would Premier version fit my scenario?

Thanks,

Nathan

[LinaJ2020]

Yes, absolutely.  If you do not have any stocks or rental transactions, in fact, TurboTax Deluxe will be good enough.  

[theCurious1]

I'm in a similar situation and was told that the buyer agent rebate would only be taxed when I sell the house in the future as a cost-basis adjustment.

How would I file the 1099-NEC such that it wouldn't tax me for 2020?

[ColeenD3]

Reposting the answer from LinaJ.

In TurboTax online, 

• Sign into your account, select Pick up where you left off
• From the upper right menu, select Search and type in 1099nec and Enter
• Select the Jump to 1099nec
• Follow prompts to complete the section
• On screen, "Does one of the these uncommon situations apply?"  Select None of these apply to me 
• Next screen, " You can deduct expenses for your work", select No

The amount will show on line 8 of Schedule 1 and Form 1040 as Other Income.