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agrad004
New Member

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

 
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Accepted Solutions
Coleen3
Intuit Alumni

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

Statutory employees are a very special designation and have their own special rules. If you are a statutory employee, you can claim certain business-related expenses on Schedule C instead of Schedule A. This means you get a bigger tax deduction than traditional employees.

Statutory employees are somewhere in between independent contractors and regular employees. Most people are regular employees - they work for an employer and the employer says what job will be done and how to do it.

Statutory employees have been declared employees under federal tax laws, but are independent contractors under common law. These workers are usually salespeople or have commission-based jobs.

The information from the W-2 has to link with your Schedule C

  1. In TurboTax Home & Business Online, go to Wages & Income and enter your W-2.
  2. Ensure that Box 13 "statutory employee" is checked. 
  3. Answer the questions on the subsequent screens until you get to:
  4. "Any Related Business Expenses?" Click "Yes". 
  5. Go through the interview questions. 
  6. Your W-2 Income is now linked to Schedule C. 

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7 Replies
Coleen3
Intuit Alumni

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

Statutory employees are a very special designation and have their own special rules. If you are a statutory employee, you can claim certain business-related expenses on Schedule C instead of Schedule A. This means you get a bigger tax deduction than traditional employees.

Statutory employees are somewhere in between independent contractors and regular employees. Most people are regular employees - they work for an employer and the employer says what job will be done and how to do it.

Statutory employees have been declared employees under federal tax laws, but are independent contractors under common law. These workers are usually salespeople or have commission-based jobs.

The information from the W-2 has to link with your Schedule C

  1. In TurboTax Home & Business Online, go to Wages & Income and enter your W-2.
  2. Ensure that Box 13 "statutory employee" is checked. 
  3. Answer the questions on the subsequent screens until you get to:
  4. "Any Related Business Expenses?" Click "Yes". 
  5. Go through the interview questions. 
  6. Your W-2 Income is now linked to Schedule C. 

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

I work as a Real Estate Appraiser, in 2015 we changed from 1099 to W2 employees.  I work solely out of my house, with the office of the company I work for being apx 80 miles away.  I only visit the office maybe twice a year for brief meetings.  The company I work for obtains the appraisal orders from several banks, and then assign them to me.  I receive 50% of the total fee collected. I'm an employee is the sense that they pay for my health insurance, MLS fees, and errors and omission insurance.  While I pay all my daily expenses such as gas, internet, phone bill, car related expanses, copy paper, and State fees to renew my appraisal license.  Before the tax reform laws went into effect I could itemize my expenses on a Schedule C, since the law change I have not.  I asked them to classify me as an statutory employee but so far they have refused. I drive an average of 40,000 business miles a year. Even though they haven't checked the statutory employee box on my W2, can I still file as one? How can I have this changed with the IRS? Thank you

 

 

DianeC958
Expert Alumni

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

If you would be considered an independent contractor under common law rules, but you are an employee under Federal Rules then you may be a Statutory Employee.

 

Here is the definition of a Statutory Employee from the IRS

 

Link to Statutory Employees

@tripline123

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On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

Yes I've read the IRS's guidance on it, but it is still kinda vague. Talks about traveling salesperson, etc. In my eyes its pretty clear that I am more of an independent contractor than a standard employee. More than 1/3 of my income over last 2 years has gone to taxes and business expenses. So while I show I make $150,000 a year, I pay around $35,000+ in income taxes, and at least $25,000 in business expenses which includes miles driven. At this point not sure what I can do. 

JamesG1
Employee Tax Expert

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

My understanding of statutory employees is that only the four occupations outlined in the IRS publication qualify.

 

My understanding is also that the burden is on the employer to ‘grant’ that designation to the statutory employee. 

 

I have seen very few statutory employees in many years of tax preparation.

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Eric4TWA
New Member

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

TurboTax defaulted my statutory income to my existing Schedule C which is for the correct business, but also has other income in it.  When I get to the Federal Review in TurboTax, it flags this as a problem having statutory income and other income in the same Schedule C.  If this is the case, how do I get the statutory income to show up in its own Schedule C?

On my w-2 in box 13 it says statuatory employee, it is telling me to report as something else

First, get rid of your existing Schedule C information.  In TurboTax Online:

  1. If you don’t see 2022 TAXES in the left pane, select the dropdown to the right of Income & Expenses on the Hi, let’s keep working on your taxes! page and then select Let’s get startedPick up where you left off, or Review/Edit. 
    • Otherwise, in the left pane, select Wages & Income
  2. Scroll down and select the Show more dropdown to the right of Self-Employment
  3. Select  Edit, Edit/Add or Revisit to the right of Self-employment income and expenses
  4. On the  Your 2022 self-employed work summary page, select Delete to the right of your self-employment item.  In the Are you sure you want to delete your Other self-employed income? popup, select Yes, delete this

Now, double-check your Form W-2 information. 

  1. In the left pane, select Wages & Income
  2. Scroll down and select Edit/Add to the right of Job (W-2)
  3. Select  Edit to the right of your statutory W-2
  4. Select  Continue on the OK, let's update the info we have for you and your employer screen
  5. Insure that the Statutory employee box under Box 13 is checked.      Select Continue, and proceed through the ensuing pages
  6. On the Tell us more about your statutory employment screen, select the appropriate option, then select Continue
  7. On the  Create a Schedule C to add your income screen, enter a business description, then select Continue

Enter your Statutory Employee expenses

  1. In the left pane, select Wages & Income
  2. You should see Needs review next to Self-employment income and expenses.  Select Review to the right
  3. Select  Review under Statutory Employee
  4. Continue through the ensuing screens, and you'll be able to input the rest of your information

Finally, enter your other self-employment income and expenses in a different Schedule C:

  1. In the left pane, select Wages & Income
  2. Scroll down and select the Show more dropdown to the right of Self-Employment
  3. Select  Edit, Edit/Add or Revisit to the right of Self-employment income and expenses
  4. On the  Your 2022 self-employed work summary page, select +Add another line of work
  5. Now, you can enter the rest of your other non-statutory self-employment income and expenses
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