The inheritance is not taxable.
Yes, you should include the $8,000 in your tax return, but it's not self-employment.
The IRS stated "that fees paid to a nonprofessional executor or personal representative (except in certain circumstances) are not SE because the services are performed on an isolated basis and stem from a personal relationship with the decedent that is not based on particular expertise or special qualities."
To determine if your 1099-MISC is subject to self-employment tax, or if you’ll have to file a schedule C, will require you to answer all of the questions in the interview. Many of the questions have examples or additional information that will help guide you in the process.
- Click on the Federal tab.
- Click on Income & expenses.
- Scroll down to Less Common Income.
- Click on Start or Update button Miscellaneous Income, 1099-A, 1099-C
- On the next screen (Let's Work on Any Miscellaneous Income), click the Start or Update button for Other reportable income.
- Continue the interview. Does one of these apply?
- Select None of these apply. - Continue
- Does this involve work like "Your" main job? - No
- How often did "You" get income for this? Enter all that are appropriate.
- Did this involve an intent to earn money? See examples if in doubt. In this case NO!
- These questions will determine if your 1099-MISC is taxable.
The income will be reported on Schedule 1 line 8 (z) with the description that you entered.
See Rev Ruling 58-5 EXECUTOR'S FIDUCIARY FEES ARE NOT SUBJECT TO SELF-EMPLOYMENT TAX.
Reminder: When you're in TurboTax, and you're not sure of something, select the (?) next to the topic for more details.
If this does not completely answer your question, please contact us again and provide some additional details.
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