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I’m doing taxes for my 21-year-old daughter. I’m entering several 1099 forms. It is placing that income in various places, thereby inflating her income. Please help!
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I’m doing taxes for my 21-year-old daughter. I’m entering several 1099 forms. It is placing that income in various places, thereby inflating her income. Please help!
The different places on the forms does not "inflate" her income. The 1099s add up to a total. That total should be showing up on line 6 of form 1040.
A 1099-Misc, with an amount in box 7, is considered self employment. That particular income is subject to both income tax and self employment tax (SET), so it may appear that her tax is being "inflated". SET is how the self employed pay their social security and medicare tax (FICA).
A 1099-R that represents an early distribution from an IRA or 401k or a 1099-Q for a non qualified distribution from a 529 plan may be subject to 1 10% penalty, in addition to income tax.
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