Your employer is reporting the bonus incorrectly. All payments from an employer to an employee should be treated as wages and included in the employee's W-2. It doesn't matter whether it's regular pay or a bonus. However, there is a way to report the bonus correctly on your tax return, in spite of your employer's error.
I assume that your employer reported the bonus in box 7 of the Form 1099-MISC, and that you also received a Form W-2 for 2016 from the same employer.
Follow the steps below to enter the 1099-MISC in TurboTax. The bonus will be included in the total wages on Form 1040 line 7. On the dotted line to the left of the amount on line 7 there will be a notation "F8919" and the amount. Form 8919 will be included in the return, with reason code H in column (c). Form 8919 will calculate the Social Security and Medicare taxes that your employer should have withheld from the bonus. The total of these taxes will appear on Form 1040 line 58 and will be included in your total tax liability.
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Your employer is reporting the bonus incorrectly. All payments from an employer to an employee should be treated as wages and included in the employee's W-2. It doesn't matter whether it's regular pay or a bonus. However, there is a way to report the bonus correctly on your tax return, in spite of your employer's error.
I assume that your employer reported the bonus in box 7 of the Form 1099-MISC, and that you also received a Form W-2 for 2016 from the same employer.
Follow the steps below to enter the 1099-MISC in TurboTax. The bonus will be included in the total wages on Form 1040 line 7. On the dotted line to the left of the amount on line 7 there will be a notation "F8919" and the amount. Form 8919 will be included in the return, with reason code H in column (c). Form 8919 will calculate the Social Security and Medicare taxes that your employer should have withheld from the bonus. The total of these taxes will appear on Form 1040 line 58 and will be included in your total tax liability.
Bonuses should be reported on a W-2 form. Ask your employer to do so, and to void the 1099-MISC.
As SweetieJean pointed out, the first step is to ask the employer to correct things.
If the employer refuses, then you need to fill out Form 8919 to pay your half of the Social Security and Medicare taxes, then the IRS will tell your employer to correct it.
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What if your employer toke taxes out of your bonus and still gave you a 1099 can he do that ?
Is the income in box 3 or box 7 of the 1099MISC? @phatkat123
Box 7 so that means he put me as a contractor right and he didn't even put that he toke taxes out in box 4 .
You need to file the income reported to you as self-employment and pay the self-employment taxes.
See How do I enter a 1099 MISC from my current employer if I don't actually own/run my own business? It was for my intro period when I was hired but paid as contracted labor for more information on your situation.
You stated that ‘the employer took taxes out of that’. Are Federal withholding taxes reported in box 4 of the 1099-Misc?
Have you asked the employer to report the income on a corrected W-2 and void the 1099-MISC?
You can complete form 8919 to pay your half of the Social Security and Medicare taxes. See here.
I'm very curious about this...because this happens almost every year with me. I receive a $1,000 bonus from my employer. I'm in Sales...and all it is, is a bonus for meeting my goal. These days I have to pay Self Employment tax with is crazy.
Below you mentioned "I assume that your employer reported the bonus in box 7 of the Form 1099-MISC, and that you also received a Form W-2 for 2016 from the same employer." In this case the bonus is reported in Box 3. Now what?
Any help would be super appreciated.
What box is the income reported in? and please review the answer from Champ rjs above as it explains how to handle the reporting if you received a 1099 with a bonus amount in Box 7 from your employer who also gave you a W-2. @henryly1935
Hi, can I use the same described method to report bonus that wasn’t reported on W-2? My former employer didn’t pay taxes for the end of the year bonus. I got only w-2 and I see it only includes regular wages. No 1099 forms were received
@winsirius You can enter wage income not reported on a W-2 form in TurboTax by following these steps: