What does a membership fee qualify as on a 1099-MISC

[revampeng]

My wife pays a monthly fee to her employer for the right to sell their products, where do we enter this as an expense?

[DS30]

Is you wife an employee (W-2) or an independent contractor (1099-MISC) ?

[revampeng]

Not sure how to answer that...she works for Thirty-One Gifts, kind of like one of those pyramid things, she pays a monthly fee for her customers to receive an email of the current specials for the month.  Her income is a 20% commission of the sales she makes.

[DS30 · Accepted solution]

Based on the information you have provided, she will be an independent contractor and will be able to deduct these membership fees as business expenses.

Once you input her 1099-MISC information, you will be able to take these business expenses against this income. (However, this may require an upgrade to TurboTax Home and Business). You can let TurboTax guide you on entering all your business income and expenses. You may even qualify for a home office expense or be able to deduct the business use of your car.

Please refer to this IRS link for more information about business expenses:

https://www.irs.gov/publications/p334/ch08.html#en_US_2014_publink1000313521

To enter these membership fees into TurboTax Online or Desktop, please follow these steps:

1. Once you are in your tax return, click on the “Business"” tab
2. Next click on “I’ll choose what I work on” (jump to full list)
3. Scroll down the screen until to come to the section “Business Income and Expense”
4. Choose “Profit or Loss from Business ” and select start/revisit/update.
5. If your business is already listed, choose to "edit"
6.  You will eventually get to a screen titled "Your () Business"
7. Scroll down to Business Expenses and select "Other Common Business Expenses". (screenshot #1)
8. Select "Other Miscellaneous Expenses" and enter "Business Membership Fees and the amounts here. (screenshot #2)