I have a 1099-MISC for paid family leave where do i ADD THIS ON MY TAX RETURN?

[Riley DE]

I was issued a 1099-Misc. for PFL by the private insurer who made PFL payments. This is not for any other type of income. Turbotax automatically treats this income as Schedule C other income, but it is not - I did not work for the income, it is just PFL. The answer from James in 2022 below seemed helpful but the Turbotax mask has changed and doesn't seem to allow me to report it in the way he describes, it assumes it is for work and tbumps Sched. C, which doesn't apply for this situation. Should I treat the 1099-Misc as a 1099-G within Turbotax?

[DianeW777]

Yes, you are correct.  This is not self employment income and should be reported by using the steps below. Once completed this will move the income to the Schedule 1, then the 1040.  You may need to delete the Schedule C.

1. TurboTax Online/Mobile > Search 1099misc > click See more > click the highlighted 1099-MISC
2. TurboTax Desktop > Search > 1099-MISC > Click the Jump to.. link
3. Enter the 1099-MISC exactly as printed, and then Continue
4. Enter Paid Family Leave
5. Select None of these apply, then Continue
6. Select No, it didn’t involve work….. and Continue to 'How often did you get income for Paid Family Leave?'
7. Select ONLY the tax year for which this specific 1099-MISC was issued. 
8. Do not select the year that you received the 1099. Select the year for which the 1099-MISC was issued. Select no other year. 
9. Select No, it didn’t involve an intent to earn money, then Continue
10. Select NO, then Continue
11. Click the DONE button > 

This will complete the entry and you can continue to work on your tax return.

You'll need to delete this form Schedule C --------------------. 

• If you're using TurboTax Online software and need to delete a form, click here.
• If you're using TurboTax Desktop software and need to delete a form, click here.

You can review your return using the steps below.  For TurboTax Desktop simply switch to Forms (upper right).

1. From the left rail menu in TurboTax Online, select Tax Tools (You may have to scroll down on the left rail menu.)
2. Select Tax Tools 
   
3. On the drop-down select Tools 
4. On the pop-up menu titled “Tools Center”, select View Tax Summary 
5. On the left sidebar, select Preview my 1040 

@Riley DE 

[ColleenV]

Hello. Regarding a 1099-Misc for 2024 FMLA benefits:

I agree, Oregon should report the benefits on 1099-G, but they are reporting on 1099-MISC, for the second year in a row, it seems. What complicates this is...

Oregon just sent out a clarification on where to report the Paid Leave Oregon (tax) subtraction - saying to follow 2024 instructions for 1040 Schedule 1, line 7 on where to report the subtraction. That line is for unemployment benefits.

If one enters the 1099-Misc as other income, but the decrease in that other income by the fmla taxes paid, it will look weird on the return, in my opinion.

Is the consensus to report this as unemployment compensation or as other income? 

Thank you.

[ColleenV]

Hello. Regarding a 1099-Misc for 2024 FMLA benefits:

I agree, Oregon should report the benefits on 1099-G, but they are reporting on 1099-MISC, for the second year in a row, it seems. What complicates this is...

Oregon just sent out a clarification on where to report the Paid Leave Oregon (tax) subtraction - saying to follow 2024 instructions for 1040 Schedule 1, line 7 on where to report the subtraction. That line is for unemployment benefits.

If one enters the 1099-Misc as other income, but the decrease in that other income by the fmla taxes paid, it will look weird on the return, in my opinion.

Is the consensus to report this as unemployment compensation or as other income? 

Thank you.

Forgive me for posting this twice. It was supposed to be in reply to DawnC not to the op. Trying to get this in the place intended.

[MonikaK1]

Report the income in the area for the type of form on which it was reported (including a 1099-MISC). You don't report it on a Schedule C. There are multiple answers in this discussion thread showing how to enter a 1099-MISC so that it doesn't appear to be self-employment income. Here is one:

1. TurboTax Online/Mobile > Search 1099misc > click See more > click the highlighted 1099-MISC
2. TurboTax Desktop > Search > 1099-MISC > Click the Jump to.. link
3. Enter the 1099-MISC exactly as printed, and then Continue
4. Enter Paid Family Leave
5. Select None of these apply, then Continue
6. Select No, it didn’t involve work….. and Continue to 'How often did you get income for Paid Family Leave?'
7. Select ONLY the tax year for which this specific 1099-MISC was issued. 
8. Do not select the year that you received the 1099. Select the year for which the 1099-MISC was issued. Select no other year. 
9. Select No, it didn’t involve an intent to earn money, then Continue
10. Select NO, then Continue
11. Click the DONE button > 

There is also a new IRS Revenue Ruling, RR 25-04, that also addresses the issue of paid family leave from state programs. It is currently open for comments and it is advising states on how to report this income.

See here for more information on the Oregon 2024 legislation that affects Paid Family Leave effective 7-1-24..

@ColleenV 

[ColleenV]

Thank you Monika for responding to me! I wasn't sure if anyone would since this discussion is a year old.

I do know not to report it on a Schedule C.

My question was concerning the subtraction to FMLA income for withholding taxes paid. I was not clear. Sorry.

My question is to report it as "other income" or unemployment income for purposes reporting the subtraction if the taxpayer does not itemize. The State of Oregon really should report this on a 1099-G.

I think I am going to report it as unemployment income on Schedule 1, line 7 to correspond with the federal instructions on how to report the subtraction. Because I cannot report the subtraction only on Schedule 1, line 7.

[nseelen]

I'm having a similar problem trying to report my wife's maternity leave. She was paid through a benefit provider who issued a 1099-MISC. I tried following these instructions but never got an option to select whether it involved an intent to earn money. We are married filing jointly; I am self-employed but my wife gets a W2. TurboTax went straight from asking which year the income was earned in to asking which business to associate the income. Is there any way to force it to ask that question, or to go directly into the form and correct it?

[AmyC]

Be sure you are not inside a business to enter the form. You need to be on the main income screen. The online and desktop programs are a little different. The key points are that you have to mark:

• no intent to earn money 
• mark that the income is only for this tax year. Otherwise the program will think it is recurring income and a business.
• mark no to like main job 

Add one more set of instructions that contains the key elements you need to locate and answer from above.

1. Log in to your return.
2. Go to income
3. Scroll down to Other Common Income or show Less Common Income
4. Select Income from 1099-MISC
5. Edit/ Start/ Revisit
6. Enter income -the income should be in box 3,
7. Enter tax if any withheld in box 4
8. Continue
9. Describe the reason -
10. continue
11. None of these apply
12. Continue
13. Did this involve main job?
14. No 
15. Continue
16. How often do you get?
17. Got in 2024 
18. Continue
19. Intent to earn money?
20. No
21. Continue
22. Do you have another?
23. No
24. Continue

@nseelen If you are using the desktop version, you can see it in Forms mode.

[nseelen]

Thanks for the help!

For anyone else struggling with this issue, the key point was to select that we only received this money in 2024. Because her maternity leave straddled 2023-2024, we did actually receive it in both 2023 and 2024, but selecting that option made TurboTax treat it like a business instead of a benefit. When we took 2023 out, we were allowed to go onto the question about whether there was an intent to earn money.

[ColleenV]

Hello.

The State of Oregon is actually very helpful. I emailed them.

They said the Oregon subtraction is only for family leave for 2024.

For 2025 only a portion of medical leave benefits are taxable - only the employer portion is taxable. 

I have not had time to double check this.

They said they cannot give guidance on how to report for the IRS and not sure what they will do if you report a lower amount on your return than was reported on the 1099.

Not sure if this helps.... But it is the information I have.