1099-NEC Conversion in 2020

[gregsanchezz]

I am returning TurboTax customer and have used TurboTax for many years.  I always file a schedule C.  The income for my schedule C is normally on a 1099-MISC with box 7 filled out for "Non Employee Compensation".  This year Non Employee compensation is being reported on form 1099-NEC. 

In the "On Demand Tax Guidance" button in TurboTax it says the following, "If you're a returning TurboTax customer, we'll check if last year's 1099-MISC had an amount in box 7. If it did, we'll automatically change your form to a 1099-NEC for this years taxes."  I transferred my 2019 return into 2020 and the above simply does NOT happen.  My 1099-MISC doesn't change to a 1099-NEC.  I am forced to create a 1099-NEC and another Schedule C.  So basically I have 2 Schedule Cs.  One with no income but prior year "pre-filled" information, i.e., depreciation items, auto info, home office info, etc. and another with the 1099-NEC income but no expenses (in other words, I need to start from scratch on the expenses).   From what I can tell, I can't link my new 1099-NEC to the prior year schedule C and the program definitely is not automatically changing my for to a 1099-NEC.

I don't want to recreate my the expense side of my Schedule C.  What gives?  Am I just doing this too soon and an update will fix this?

Thx --

[macuser_22]

The IRS has not finalized many forms and/or form instructions.   As they become available, TurboTax will issue updates.   Expect many updates between now and March 2021 since the IRS is short handed and way behind because of COVID-19.

[gregsanchezz]

Right, but inside the 2020 TurboTax it literally says that if you had 1099-MISC with Box 7 completed it will automatically convert your form to 1099-NEC. This would have nothing to do with what the instructions are for 1099-NEC.  So I can’t even start working with TurboTax 2020 and transfer my 2019 return until an update is done because it keeps creating a 2nd schedule C. 

[macuser_22]

I just tested this by adding a 1099-MISC with box 7 compensation to a 2019 test file and then used that file to transfer to TT 2020 and it did indeed create a blank 1099-NEC form in the forms list.

[gregsanchezz]

I don’t have an issue with being able to create and fill out a 1099-NEC. That’s not the issue. The problem is that you can’t link it to prior year Schedule C already created.  When you utilize the 1099–NEC it asks you if you have expenses to report. Saying yes creates a schedule C separate from the one from prior year leaving two schedule C’s. I have depreciation, home office, assets, etc from prior related to same business on the other Schedule C.

[touchdowntitans]

My issue may be identical -- I have the TT Premier version and have used this version for many years with no issue added my 1099 income to schedule C.  I expect to receive a 1099 (now 1099-NEC vs. 1099-MISC) for 2020 but TT Premier is not allowing me to add 1099-NEC data to my schedule C.  When I enter the 1099-NEC information within TT, it does not move to schedule C.  I can only enter 1099-MISC data to schedule C (consistent with past).  Is this something TT will likely address in future updates or am I missing something?  

[Mike9241]

TT will probably fix this issue.  however, you don't have to use 1099-NEC or even 1099-MISC. TT premier has forms mode and you can enter the total of your schedule C gross income on line 1a (even though it may say income other not reported on 1099-NEC). if you prefer some detail right click on the empty box on line 1a for the amount. a + sign will appear. click on that and you can add some detail without having to enter all the info that can be entered on a 1099.  note that when e-filing TT does not send the details of what's entered on either the 1099-NEC or MISC to the IRS.  

[tagteam]

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@Mike9241 wrote:

TT premier has forms mode and you can enter the total of your schedule C gross income on line 1a...

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As mentioned in an earlier post, the desktop version of Premier actually has a 1099-NEC worksheet that can be accessed in Forms Mode where all of the information can be entered from the 1099-NEC recevied.

[workcopy2020]

If you have a 1099M for 2019 and now has a 1099NEC for the same company this is what you need to do: -->  it asks you if you have a 1099M OR a 1099NEC for any of the businesses you had last year. You delete the 1099M's shown (that are now 1099NEC - easy) and it should also give the choice of going forward with a 1099NEC for the same businesses and you click "ok" for that one and then enter any 1099NEC's that are new for 2020. If you continue down that path it deletes the old 1099m shells and continues on to link the NEC's with the existing Sch C. If they don't do this - the 1099NEC's that in 2019 were 1099M'a will NOT link to the existing Sch C and it creates a nightmare.

[ilyaokun]

That worked well. Switched to the forms, found and filled the form 1099-NEC. After switching back to "Guided", the form 1099-NEC Income in the Business Income has appeared there with the information entered in the Form view.

[SBen616]

This is so very confusing. TT used to be so simple. I can not e-file because it keeps taking me to the “1099-NEC worksheet” page. I have NO clue what I’m suppose to be entering there. 

[CatinaT1]

Currently there is a known issue when using TurboTax Online that is related to the program asking you to double-click to link to Schedule C. 

Please review the article below and use the link in the article to enter your email address to be notified once this is resolved:  

TurboTax: Why Am I Unable to Link my 1099-NEC?

Also you can review the information below for a possible steps to solve the issue.  

Income reported on Form 1099-NEC must be reported on Schedule C, the program is trying to link these two forms together to be sure that it is reported correctly and on the right form.

Revisit the section where you entered the Form 1099-NEC if you entered it on its own and delete that entry, by following these steps:

1. Open TurboTax.
2. On the top right corner of TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner).
3. Type in “1099-NEC” (or for CD/downloaded TurboTax, click Find),
4. Click on “Jump to 1099-NEC”
5. Click on the blue “Jump to 1099-NEC” link

This will bring you a summary of all Form 1099-NEC that you have entered.  Click Delete or the trash can icon next to each one.

Next, you will re-enter the Form 1099-NEC as part of the Schedule C so that the income is reported directly as part of your Business Income and Expenses and within the correct form and section of your return.

Follow these steps to go to the Schedule C section of your return:

1. On the top right corner of TurboTax online screen, click on Search (or for CD/downloaded TurboTax locate the search box in the upper right corner).
2. Type in “schedule c” (or for CD/downloaded TurboTax, click Find).
3. Click on “Jump to schedule c”.
4. Click on the blue “Jump to schedule c” link

If you already have created a Schedule C in your return, click on edit and go to the section to Add Income.  This is where you will re-enter the Form 1099-NEC. 

If you do not already have a Schedule C in your return, follow the prompts and enter the information about your work/business for which you received the Form 1099-NEC.  Then continue through that section to Add Income and enter the Form 1099-NEC along with any additional income you received for that business.  

Once you have completed this, the error should be eliminated. 

[grvijay]

When we add the 1099-NEC, it picks up the default first name on the list. Even if we change the radio button option, it still selects the primary name instead of the spouse name. I tried and it doesn't change. I had to wait for the fix.

[macuser_22]

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@grvijay wrote:

When we add the 1099-NEC, it picks up the default first name on the list. Even if we change the radio button option, it still selects the primary name instead of the spouse name. I tried and it doesn't change. I had to wait for the fix.

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See this TurboTax FAQ:

https://ttlc.intuit.com/community/tax-topics/help/why-am-i-not-able-to-link-my-1099-nec-to-my-spouse...

[grvijay]

checked the link and it says the issue is resolved with this comment...

Some TurboTax customers are experiencing an issue linking a 1099-NEC to the correct person. The name on the NEC is reverting to the main taxpayer's name.

How do we make sure it is pointing it to the spouse?

Tx