Self Employed with PayPal, discrepancy with the State field on my 1099K form.

[coleh17__]

I am a resident of California, however, while I am out of state for school, I have my PayPal address set to my school address to receive mail there.

Because of this, the 1099K form that PayPal sent me has the "State" field marked as the state my school is in, rather than CA.

Already tried contacting PayPal and they suggested I declare non-residency for my business, however, I do not own a "business", just self-employed with no legal business, so unsure of what to do here.

Just wondering how big of an issue this is, and if so, how can I go about fixing it?

Thank you in advance!

[LeonardS]

Form 1099-K is an informational form, the information is used to prepare your tax return.  Could you please clarify why you received Form 1099-K, as the reason for receiving it will determine how to enter the information on the form on your tax return?

[coleh17__]

I received Form 1099K from PayPal for surpassing the $20,000 and 200+ transactions over the last year. Let me know if that answers your question!

[LeonardS]

You will need to file Schedule C Profit or Loss from Business to report the income on your 1099-K and your expenses, to include the cost of the items sold, to figure your net profit.  

To enter your 1099-K on a Schedule C follow these steps:

1. Open your return.
2. Search for schedule c and click the Jump to link in the search results.
3. Answer Yes to Did you have any self-employment income or expenses?
4. Follow the on-screen instructions.
5. On the page titled, Your info, scroll to the bottom and click Looks Good.
6. Click on Form 1099-NEC on the page Let’s enter the income.
7. Click continue.
8. Follow the on-screen instructions.
9. Enter any relevant expenses to your business.  

If you are entering income from a 1099-K, remember that it reports the gross amount of the transactions. It doesn't include any adjustments for credits, refunds, discounts, or fees. You’ll have a chance to enter self-employment expenses in another part of your return.

This link How do I enter a 1099-K in TurboTax Online? has information that you may find helpful. 

[coleh17__]

Thank you for the info!

However, I am still not sure the answer to my original question... does it matter that PayPal marked my 1099K form with a state that I don't reside in, or will it be okay since I am filing a Schedule C anyways?

[LeonardS · Accepted solution]

No, it does not matter that PayPay used your mailing address state instead of your actual state. Form 1099-k is an informational form and you will only enter the amount reported.  You do not enter any information related to your address on Form 1099-K in your tax return

[coleh17__]

Sweet thank you very much for the help and the info about the Schedule C Form!