I need to override the Self-employment (SE) auto-generation forms from passive investments in our SMLLC. Is this possible? TT automatically generates the SE forms and my tax accountant says the interest income is not subject to SE taxes. Every time I enter Schedule C (tax accountant prepared) TT automatically generates the SE forms.
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if you report interest income on schedule C it will be deemed self-employment income. (only interest income earned on trade accounts and notes receivable in the ordinary course of conducting a trade or business is subject to SE tax). There is no direct way around this in Turbotax. Proper entry of interest income on investments would be on schedule B using 1099-INT form. For the 1099-int payor - interest income from SMLLC XX-XXXXXXX
As an alternative that i don't recommend because Turbotax does not provide the IRS with any details of other income. report as other income and then as an other expense "interest income on line 5 transferred to schedule B -XXX"
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