I sold a collection of musical instruments for the widow of a friend. I have a 1099 from Paypal, the checks I sent her, shipping receipts etc. What must I do on my 1040?

[mikameron]

I did not take any fee or commission. She used the proceeds to establish a scholarship in his name.

[DianeW · Accepted solution]

This is not really income for you so you can enter the 1099-MISC income and then nominee it to the friend that it belongs to. And because this is not self employment income you should enter the income as follows.

This income can be entered as miscellaneous income.  When you sign into your TurboTax account you can follow the steps below.  

• Select the "Federal" tab in the black navigation bar on the left
• Select "Income & Expenses"
• Select "Add more income" button if necessary
• Scroll and click "See the list of all income" 
• Scroll to "Less Common Income" and select "show more"
• Select "Miscellaneous Income"
• Scroll and select "Other Reportable Income"
• Click "yes" then enter the description and amount

Next, repeat these steps to add a negative income labeled "Nominee" and include the social security number of the other person if you can. Example:  -500 (use the minus sign in front of the numbers)

This should provide a positive and negative number resulting in zero income for you.