A company rented my apt for a shoot and sent a 1099-MISC. They broke a lamp, paid me, but included the cost in "nonemp comp". Where do I deduct the cost of the lamp?

[BMcCalpin · Accepted solution]

Well, they probably should have put the amount in box 1 of the 1099-MISC, not in box 7. Box 7 would be appropriate if they had hired you for some contract (non-employee) work. If all they did was rent your apartment, then they should have put it in box 1 of the 1099-MISC.

Of course, you could enter the box 7 and enter the data for your "business" of renting apartment space. You could deduct the lamp there, but you will also have to pay self-employment taxes. If you weren't working as a contractor but just renting space, this would be unfair to you.

If you really just rented the space out, then you can create a Schedule E (look for Rental Property and Royalties under Business in Home & Biz (now renamed to "Self-Employed"). In the Rental Property interview, you will be able to enter both your income and your expenses (like the broken lamp, but maybe some other things)...but there would be no self-employment tax to pay.

If you, in fact, were not a contractor but just rented space, contact the company and get them to issue you a "corrected" 1099-MISC. Otherwise, the IRS will be looking for self-employment tax from you.

[Edited 4/2/2019 3:15 pm CDT - typo]

[Anonymous]

What a terrific and generous response!  Thank you.  I'll go the path of the Schedule E, which I didn't realize would not trigger the self-employment tax.  This is a great solution as my receipts exactly equal the amount in box 7 if the IRS wants to take a look.