How do I enter wages for my rentals?

[andyl9063]

I have 1 wages for my rentals. They do book keeping and etc for all of my rentals. Where do I enter that? I have all the rental properties enter under rental properties/royalties. Should I just add a new business under business income/expense and put wages there?

[ColeenD3]

Are you asking where to include the expenses for contractors on Schedule E? You can include them as a miscellaneous expense. You may have needed to issue a 1099-NEC.

File Form 1099-NEC, Nonemployee Compensation, for each person in the course of your business to whom you have paid the following during the year.

• At least $600 in:

1. Services performed by someone who is not your employee (including parts and materials) (box 1); or
2. Payments to an attorney (box 1). (See Payments to attorneys, later.)

Trade or business reporting only.

Report on Form 1099-NEC only when payments are made in the course of your trade or business. Personal payments are not reportable. You are engaged in a trade or business if you operate for gain or profit. However, nonprofit organizations are considered to be engaged in a trade or business and are subject to these reporting requirements. Other organizations subject to these reporting requirements include trusts of qualified pension or profit-sharing plans of employers, certain organizations exempt from tax under section 501(c) or 501(d), farmers' cooperatives that are exempt from tax under section 521, and widely held fixed investment trusts. Payments by federal, state, or local government agencies are also reportable.

[andyl9063]

This person is an employee, not a contractor. Do I still do the 1099?

[ColeenD3]

No, you would issue a W-2.

Every employer engaged in a trade or business who pays remuneration, including noncash payments of $600 or more for the year (all amounts if any income, social security, or Medicare tax was withheld) for services performed by an employee must file a Form W-2 for each employee (even if the employee is related to the employer) from whom:

• Income, Social Security, or Medicare tax was withheld.
• Income tax would have been withheld if the employee had claimed no more than one withholding allowance or had not claimed exemption from withholding on Form W-4, Employee's Withholding Allowance Certificate.

[andyl9063]

ok, so i issue a w-2, now how do I expense the wages as part of the rentals? Do I still enter that in misc expense?

[PattiF · Accepted solution]

Yes, you would enter this as a Miscellaneous expense in the rental expense section.