Federal 2018 Form 1040 line 6 and schedule 1 income

[LR01]

Hello, 

I have a question regarding my federal income tax 1040 form line 6 and schedule 1 income.

This is my example: I have additional income, 1099 Miscellaneous totaling $400 for some independent contract work. This income was not included on my W-2 or a 1099. Moreover, this income was a sporadic activity (i.e., done only two times in the year) so it does not fall under the definition of a “business.” According to the IRS: An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. My only other income was my W-2 ($14,808).

Questions: Should the $400 income be reported on the Schedule 1 line 21? Should line 21 from my Schedule 1 show up on line 6 of my 1040? My 1040 in the Turbo Tax Software, however, indicates line 1 as $14,808. For line 6 on the 1040, it reads: Add any amount from Schedule 1, line 22. My 1040 indicates a 0 so the total for line 6 is $14, 808 rather than $15,208. I called the help line and the representative was unable to assist with this matter.

[Carl]

If the income is reported in box 7, then as far as the IRS is concerned it's self-employment income. If you report otherwise then be prepared to prove it on a paper audit from the IRS. There are exceptions for box 7 income. But doing something as an "independent contractor" doesn't fall anywhere close to an exception. Doesn't matter if you only did it once. Independent contractors have an intent to make a profit. Period.

If reported in box 3, then usually it's no problem.

Reporting 1099-MISC (box 3 or box 7) that is not self-employment income

Under the Wages & Income tab (or Personal Income tab) scroll down to Other Common Income and elect to start/update Income from form 1099-MISC. Then click YES to indicate you have a 1099-MISC.

Enter the 1099-MISC exactly as printed, and then Continue.

Enter the reason you got this money – be it scholarship, bonus, streaking butt naked across the 50 yard line of the super bowl, whatever. Then continue.

Select None of these apply, then Continue.

Select No, it didn’t involve work….. and Continue.

Select ONLY the tax year for which this specific 1099-MISC was issued. Do not select the year that you received the 1099. Select the year for which the 1099-MISC was issued. Select no other year. Then Continue.

Select No, it didn’t involve an intent to earn money, then Continue.

Select NO, then Continue.

Click the DONE button, and that does it.

[dmertz]

Yes, if this does not qualify as self-employment income it should appear on Schedule 1 line by entering it into TurboTax under Miscellaneous Income, 1099-A, 1099-C -> Other reportable income.  The amount that appears on Form 1040 line 6 will be the sum of the amounts on 1040 lines 1 through 5 plus Schedule 1 line 22.