1099 MISC for Residents

Forum|Forum|6 years ago
February 25, 2020
2 replies
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Hi all,

I am an International student on F1 visa but a resident for tax filing purposes since its been over 5 years in the USA. I have little 1099 MISC income for 2019. Before entering the 1099 details on the Turbotax free software, I was getting a refund of about $XYZ (federal+state) BUT post adding the 1099 MISC details, it shifted straight to money I owe the IRS (around ABC$, state+federal). In addition, the 1099 MISC related questions on the software treats the inputs as if you own the business and asks several unnecessary questions.

Did anyone have similar experience? Any suggestions?

TurboTax Free Edition Online

MinhT1

Level 15

Income reported in box 7 of form 1099-MISC is self-employed income. You are considered as self-employed and in IRS parlance, are operating a business doing what you do to earn the income reported on the form 1099-MISC. Self-employed income is subject to income tax AND self-employment tax (calculated at 15.3% on 92.35% of net self-employed income).

You do not own a business in the common meaning of the word. So in TurboTax answer that you use the cash method, that you do not have an EIN. You use your own name as the business name and your personal address as the business address.

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jeetshekAuthor

Level 2

Hi,

Thanks a lot for your reply. Are you suggesting the business name to be my name and no EIN mentioned on it? Also how do you suggest I address these questions below:

Describe the reason for this 1099-MISC

Does one of these uncommon situations apply?

Did the involve work that's like your main job?

Did the involve an intent to earn money?

Let's confirm the reason for this income?

The work I did was an internship for a startup company that involved some engineering related work.

linaj20201

Level 14

Yes, you can use your name as the name of the business. If you do not have any employees, you are not required to have an EIN.

1. Reason for the 1099-MISc, you can simply put something like Engineering internship

2. If none of the uncommon situations apply, simply check None of the Above.

3. If this internship involves work like your main job, you would say Yes

4. If you have intent to earn money, select Yes

5. Then follow prompts

When you receive a Form 1099-MISC, the IRS will be receiving a copy as well. Most of the time, IRS treats taxpayers who receive a Form 1099-MISC as business-related thus self-employed. You are required to pay Self-Employed taxes. If you received this form only once in a while for some work unrelated to your main job, or if you receive it as an award or prize, you would not be treated as self--employed. If you will be receiving it ongoing in the future, you are self-employed and will need to file a Schedule C.

KarenJ2

Level 13

Please see the following link:

Why is there an amount in Box 7 (Nonemployee Comp) on my 1099-MISC

You worked for the firm but they did not withhold FICA taxes and federal and state taxes for your work with them. They did not consider you an employee. So the taxes will need to be paid with your tax returns.

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jeetshekAuthor

Level 2

Yes, I understand that and I am not debating it. The issue is- the numbers dont really match up. I am owing a lot more than what I am supposed to be (as suggested-calculated at 15.3% on 92.35% of net self-employed income) and the fact that I am shifting from refund to money I owe because of 1099 MISC entry is really frustrating. This is largely because of the fact that Turbotax assumes me to be a business owner whereas I was merely an intern for the company.

Please suggest the best way out of this.

LeonardS

Level 14

Lets say I earned $3000. By my calculations, I should owe 430$ but the amount reflected on my Turbotax is different/higher. Let me know what you think @KarenJ2

Have you taken into account any self-employment tax you my owe on the 1099-MISC income.

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