I have a 1099-MISC, number in box 3, NO Number in Box 7. Why does Turbo Tax keep trying to force me to fill out a Schedule C?

[palmerrl7_mrk]

I have a 1099-MISC from my employer for performance bonus.  There is a number in Box 3, but NO number in box 7.  Turbo Tax keeps trying to have me fill out a Schedule C for self-employment.  This is NOT self-employment.  Should I mark the 1099-MISC as prize money?

[LisaBr · Accepted solution]

No, When entering this 1099-MISC, you will need to answer the subsequent questions so that the income flows to Line 21 and your description of the activity will show on this line as well.

Follow these instructions to enter this 1099-MISC, not under Self-Employment.

Go to Federal, then Wages and Income.  From there, choose Other Common Income.  Once in this section, choose 1099-MISC.  This is where you enter the information in the 1099-MISC.

1.  Describe reason for 1099-MISC  (Performance Bonus)

2.  Identifying if any of the less common situations for receiving the money applies to your situation.  Choose None since these situations do not apply to you.

3.  Did this work involve activities LIKE your main job?  Focus on basic skill necessary, not the employer.  If you answer yes, TurboTax will let you know you can deduct expenses for this activity (Schedule C).  Since this was a bonus for your performance, your answer is No.

4.  Did the activity involve an intent to earn money?  Did you do this activity with the sole purpose of earning money .  This answer is also No, since the money is a happy consequence but not "intentional".