form 1099-K incorrect

8 replies
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PayPal sent me an incorrect 1099-K. They refuse to correct and state I must deal through a tax professional. I spoke to a support person and a supervisor at PayPal and got the same answer.

Not A Product Question

tmunozAnswer

Level 13

If you have received a Form 1099-K which contains errors or has amounts that are not income and not self-employment, you should enter the Form 1099-K as it is received the Other Common Income section, so that it matches what was reported to the IRS.
If the form was for business or for sales of personal items, it will be entered elsewhere, so please give us details if this is the case.

In addition, make an adjustment to show the negative amount which should be subtracted.

For instance:

1099-K personal transactions $ -100

1099-K sale of personal items at loss $ -200

To enter this, go to:

Wages and Income
Scroll down to Less Common Income and select Show More
Scroll down to the last entry and select Start or Review for Miscellaneous Income, 1099-A, 1099-C
Scroll to the last entry, Other reportable income and click on Start
Any Other Taxable Income? Select Yes
Then enter 1099-K, the reason for the adjustment, and the amount, as below, and Continue

This adjustment entry will appear on the return on Form 1040, Schedule 1 Part II – Line 24z, Other Adjustments, which follows the directions from the IRS on their website. See Question 8 for an example.

It should show like this on your Schedule 1

tmunozAnswer

Level 13

In addition, make an adjustment to show the negative amount which should be subtracted.

For instance:

1099-K personal transactions $ -100

1099-K sale of personal items at loss $ -200

To enter this, go to:

Wages and Income
Scroll down to Less Common Income and select Show More
Scroll down to the last entry and select Start or Review for Miscellaneous Income, 1099-A, 1099-C
Scroll to the last entry, Other reportable income and click on Start
Any Other Taxable Income? Select Yes
Then enter 1099-K, the reason for the adjustment, and the amount, as below, and Continue

It should show like this on your Schedule 1

TGMOCATKUAuthor

Level 2

TurboTax cannot handle your solution currently. See this:

Further TurboTax support has no ETA for this. Therefore, I cannot file my taxes.

ThomasM125

Alumni - Intuit

The solution offered by @tmunoz of entering a negative adjustment to income would be the correct solution. TurboTax may come up with a more expeditious way of entering it in the program, but the results will likely be the same. So, you can enter a negative adjustment to income to cancel out the income entered from your 1099-K as follows:

Choose the Federal option on your left menu bar
Choose Wages & Income
Find Less Common Income in the list of income sources
Use the Show More option to expand the choices and choose Miscellaneous Income, 1099-A, 1099-C
Choose the Other Reportable Income option and find Other Taxable Income in that section
Enter a description for your adjustment and the amount as a negative number

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RobertB4444

Alumni - Intuit

This seems like it is working exactly as it should and providing you with exactly what you need in order to remove the income from your tax return while at the same time reporting it properly to the IRS.

@curtturbo

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