1099-NEC Deductions & Credits

Forum|Forum|4 years ago
April 14, 2022
2 replies
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I received a 1099-NEC and am a full-time employee for a furniture store as a salesperson. I received this as I receive occasional manufacturing incentive payments from mattress companies.

I chose to name SE business as "manufacture incentive payments" as it describes my business income and used business code 999999.

Questions: 1) Do I check 'yes, I played an active role in business operations." I'm confused as in prior years, 1099-MISC was much easier to fill out in Turbo Tax. However, the salespeople do not consistently receive manufacturing incentives (only a couple of times and usually during holidays).

2) Is my business "Manufacturing Incentive Payments" deemed a qualified business income?

3) Back to the issue of income? SE or would it be considered other income?

Any guidance would be appreciated.

Best answer by ee-ea

These SPIFF 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.

You report them as Other reportable Income, even if they are reported on form 1099-NEC.

In TurboTax, open your return and follow these steps:

Click on Federal in the left-hand column, then on Wages and Income on top of the screen
Scroll down and locate the Less Common Income section
Click Show more and click Start next to Miscellaneous Income at the bottom
On the next page, click Start next to Other Reportable Income.

ee-ea

Answer

Alumni - Champ

You report them as Other reportable Income, even if they are reported on form 1099-NEC.

In TurboTax, open your return and follow these steps:

Click on Federal in the left-hand column, then on Wages and Income on top of the screen
Scroll down and locate the Less Common Income section
Click Show more and click Start next to Miscellaneous Income at the bottom
On the next page, click Start next to Other Reportable Income.