Solved: I have a W2 and a 1099 Misc box 7 from the same employer for a car allowance. How do I deal with that?
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I have a W2 and a 1099 Misc box 7 from the same employer for a car allowance. How do I deal with that?

 
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Level 2

I have a W2 and a 1099 Misc box 7 from the same employer for a car allowance. How do I deal with that?

Your employer may reimburse you for using your car at work, but, if the payments aren’t made pursuant to an accountable plan, your employer has to include them on your W-2. As a result, the reimbursements will be reported on your tax return in the same way as your wages.

Follow the steps below to enter the 1099-MISC in TurboTax. Your car will be included in the total wages on Form 1040 line 1. On the dotted line to the left of the amount on line 1 there will be a notation "F8919" and the amount. Form 8919 will be included in the return. Form 8919 will calculate the Social Security and Medicare taxes that your employer should have withheld from your car allowance. The total of these taxes will appear on Form 1040 and will be included in your total tax liability.

  • In your Federal return, choose the tab for Wages & Income
  • On the screen Great, let's keep getting the details... scroll all the way down to the last section Less Common Income.  (You may have to choose Add more income and See more income to view this topic.)
  • Click the Start button for the last topic, Miscellaneous Income, 1099-A, 1099-C.
  • On the next screen choose Other income not already reported on a Form W-2 or Form 1099.
  • The next screen asks Did you receive any other wages? Select Yes and click Continue.
  • The next two screens ask about household employee wages and sick or disability pay. Click Continue on these two screens without entering anything.
  • The next screen asks Did you earn any other wages? Select Yes and click Continue.
  • The next screen asks the source of the other earned income. Select Employee compensation that was not reported on a W-2. Ignore the note that says not to enter compensation for which you will receive a 1099. Click Continue.
  • On the next screen, Employee Compensation Not Reported on a W-2, click Continue.
  • If you are filing a joint return, you will get a screen asking which one of you the income is for. Select your name and click Continue.
  • On the next screen, Report Your Wage Income, enter the employer's name and EIN from your 1099-MISC. For Total Wages Received, enter the amount on the 1099-MISC. Select Reason Code H and Continue.
  • On the next screen, Report as Wages, click Continue.
  • This returns you to the Miscellaneous Income screen.

View solution in original post

1 Reply
Level 2

I have a W2 and a 1099 Misc box 7 from the same employer for a car allowance. How do I deal with that?

Your employer may reimburse you for using your car at work, but, if the payments aren’t made pursuant to an accountable plan, your employer has to include them on your W-2. As a result, the reimbursements will be reported on your tax return in the same way as your wages.

Follow the steps below to enter the 1099-MISC in TurboTax. Your car will be included in the total wages on Form 1040 line 1. On the dotted line to the left of the amount on line 1 there will be a notation "F8919" and the amount. Form 8919 will be included in the return. Form 8919 will calculate the Social Security and Medicare taxes that your employer should have withheld from your car allowance. The total of these taxes will appear on Form 1040 and will be included in your total tax liability.

  • In your Federal return, choose the tab for Wages & Income
  • On the screen Great, let's keep getting the details... scroll all the way down to the last section Less Common Income.  (You may have to choose Add more income and See more income to view this topic.)
  • Click the Start button for the last topic, Miscellaneous Income, 1099-A, 1099-C.
  • On the next screen choose Other income not already reported on a Form W-2 or Form 1099.
  • The next screen asks Did you receive any other wages? Select Yes and click Continue.
  • The next two screens ask about household employee wages and sick or disability pay. Click Continue on these two screens without entering anything.
  • The next screen asks Did you earn any other wages? Select Yes and click Continue.
  • The next screen asks the source of the other earned income. Select Employee compensation that was not reported on a W-2. Ignore the note that says not to enter compensation for which you will receive a 1099. Click Continue.
  • On the next screen, Employee Compensation Not Reported on a W-2, click Continue.
  • If you are filing a joint return, you will get a screen asking which one of you the income is for. Select your name and click Continue.
  • On the next screen, Report Your Wage Income, enter the employer's name and EIN from your 1099-MISC. For Total Wages Received, enter the amount on the 1099-MISC. Select Reason Code H and Continue.
  • On the next screen, Report as Wages, click Continue.
  • This returns you to the Miscellaneous Income screen.

View solution in original post

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