1099 From Canadian Company

[AngeLu]

Hi - I started working last year as a self-employed contractor for a company in Canada. They sent me a 1099-Misc but they don't have a TIN nor are required to (according to H&R Block and another guy I just spoke with). I submitted this income in Turbo Tax but at the last "Review" page, it says that this 1099 needs review. "Form 1099-Misc Worksheet: Payer's EIN You must enter a Federal EIN or a social security number for the payer." 

Any advise? Would be most appreciated!!

Andrea

[LenaH]

You should report this income under foreign income, not on the 1099-MISC screen. You would only qualify for the foreign income exclusion if you lived and worked in another country.

You may also qualify for the Foreign Tax Credit if you paid, accrued, or owe taxes on foreign income that is also subject to U.S. income tax. 

To report your foreign income, please follow the steps below:

1. Open your return.
2. Search for foreign income.
3. Answer Yes for the question Did you make money outside of the US?
4. Click on A Form 1099-MISC for the question What Form Was Foreign Income Reported on?
5. Follow the on-screen instructions.

Please also make sure you delete your previous entry of your 1099-MISC. 

For more information, please see Do I need to report foreign income? and What does or doesn't qualify for the Foreign Tax Credit?

[AngeLu]

@LenaH,

THANK YOU! I am so ignorant about this so truly appreciate your help. I found the foreign income and selected that the income was reported on a 1099 Misc. I then entered the total cash amount and nothing for the next two screens about goods and reimbursements. The next screen asks if I'm eligible for the Foreign Tax Credit, which I'm not. Lived and worked 100% in the US. Turbo Tax then said it was deleting everything and took me back. So I don't think that's it.

To clarify, I live and work in the US. I am self-employed contractor for a Canadian based company who sent me a 1099 Misc. I tried to enter this as self-employed income, along with all of my expenses. 

If you have any further insight, I would be extremely grateful!!

[DaveF1006]

It depends.  Is Turbo Tax or IRS accepting the EIN from the Canadian Based employer? Entering this in as self-employment income is the correct reporting for this 1099 MISC. Next question, did they issue you a 1099-MISC or 1099-NEC? If a 1099-MISC, what box was the income reported in? Once, I have this information, I will give you a definitive answer.

[AngeLu]

@DaveF1006 THANKS!

There is no EIN. The Canadian employer sent me a 1099 Misc and filled out

1. their name and address
2. my name and address
3. the annual "Other Income" in box 3
4. my Social Security in the "Recipient's TIN" box

[DaveF1006]

It depends. You will want to report this income as self-employment income because you did perform a service with the intent to earn money.  Here is the best way to do this.

1. Log into Turbo Tax.
2. If you have already entered the 1099-MISC, delete or remove it wherever you entered it.
3. go to federal>income and expenses>Self-Employment>Self-employment income and expenses>start or revisit
4. Now you will set up your business profile in the next few screens.
5. After setting up your profile, scroll until you get to a screen that says Let's enter the income for your XXXX work.
6. Pick the option that says other self-employed income, includes 1099-K, cash, and checks
7. When you get to the income screen, Type in Income from 1099-MISC from Canadian Company and then the amount.

[AngeLu]

Thanks! I did this a few times and in the review, it still says I must enter a federal EIN or TIN. Oy. 

[ToddL99]

If the 1099-MISC did not have  the payer's (issuer's) FEIN, then do not report it in the 1099-MISC or 1099-NEC interviews; without an FEIN it isn't a valid 1099-MISC and could not have been reported to the IRS.

Follow @DavidF1006 's instructions, and enter it as General Income (Other self-employed income, includes 1099-K, cash, and checks). See the screenshot below for aid in navigation.

You will want to report this income as self-employment income because you did perform a service with the intent to earn money.  Here is the best way to do this.

1. Log into Turbo Tax.
2. If you have already entered the 1099-MISC, delete or remove it wherever you entered it.
3. go to federal>income and expenses>Self-Employment>Self-employment income and expenses>start or revisit
4. Now you will set up your business profile in the next few screens.
5. After setting up your profile, scroll until you get to a screen that says Let's enter the income for your XXXX work.
6. Pick the option that says other self-employed income, includes 1099-K, cash, and checks
7. When you get to the income screen, Type in "Income from 1099-MISC from Canadian Company" (this is a description, not an interview) and then the amount.