Solved: California wait time penalty taxable (1099 MISC)?
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rkong79
Level 2

California wait time penalty taxable (1099 MISC)?

In California, if an employer doesn't furnish last paycheck within a period of time, they are penalized through a form of payment to the former employee.  This had happened to me in 2020, and I had received a 1099-MISC for that amount.

 

Can anyone confirm whether this 'Other Income' is taxed as federal and state income?  I keep reading that it is not considered as wage, but Turbo Tax software collects federal and state income on this amount.

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Accepted Solutions
JeffreyR77
Expert Alumni

California wait time penalty taxable (1099 MISC)?

If you receive a 1099-MISC, it has been reported to the IRS as income and it is taxable income to you. Report it on your tax return as it was reported on the 1099-MISC.  It is not subject to self-employment and medicare taxes.  

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1 Reply
JeffreyR77
Expert Alumni

California wait time penalty taxable (1099 MISC)?

If you receive a 1099-MISC, it has been reported to the IRS as income and it is taxable income to you. Report it on your tax return as it was reported on the 1099-MISC.  It is not subject to self-employment and medicare taxes.  

View solution in original post

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