1099-NEC Results in Huge Refund

[viking22]

My wife's income is reported this year as 1099-NEC.  I think it was 1099-MISC last year.  

When I put in information for the 1099-NEC (income and 0 withholding) the refund suddenly goes to about the amount that I just entered.

I suspect that the employer entered the information on the form incorrectly.  They have the income amount in box 4 (Federal income tax withheld) and blank for box 1 (Nonemployee compensation).  The first time I entered the data from the form, I did it as is on the form.  Realizing that it must be wrong, I reversed it.  Still, the large number persists.

I deleted the income altogether and re-entered it a couple of times with no substantive change.  I *could* delete all of it, including expenses, etc., but if I have to do that I think I will use some other software.  I've been using TT for 8 years.  

Any idea what to do with this?

[LinaJ2020]

If you believe your Form 1099-NEC is not correctly reported, you would need to contact your employer for a corrected version.  As IRS also receives a copy of this form, it is important for you to enter the information correctly on your tax return.  If you know how much you have made and if you have taken any federal taxes from the income amount, you can test it in the program to predict your refund or taxes owed, just to get an idea. ( Income amount should be in box 1 and federal tax in box 4)

Beginning with the 2020 tax year, the IRS will require business taxpayers to report nonemployee compensation on the new Form 1099-NEC instead of on Form 1099-MISC. Businesses will need to use this form if they made payments totaling $600 or more to a nonemployee, such as an independent contractor.  This was done to help clarify the separate filing deadlines on Form 1099-MISC and the new 1099-NEC form will be used starting with the 2020 tax year. 

Generally, most taxpayers who receive a Form1099-NEC are considered as self employed by the IRS and required to pay self employment tax.  You will need to file a Schedule C reporting both income and any related expenses.  You will also need to file a Schedule SE to pay your self employment tax.  If you received the form for a non-self employment income, you will enter it as Other Income on your Form 1040.  Follow the prompts in the TurboTax program and it will take you there.  To learn more, click here: 1099-NEC

I hope it helps.  

[viking22]

Hi Lina,

Thanks for your response and the information.  My primary concern was that the software seems to have a bug.  The amount of out refund shouldn't be close to the amount of her income.  There's no way that makes sense.  

[LinaJ2020]

Currently there are two types of 1099-NEC issues have been submitted and are currently under investigation.  Please see links below.  If they apply to you, click on them and sign up for an email notification when it's fixed.  

1099 NEC link to spouse

Why am I not able to link my 1099-NEC

Thank You for your patience