There is a section in the federal screens to enter your 1099-NEC. You can either enter your nonemployee compensation so it flows to a Schedule C (self-employment income) or enter it so it flows to Other Income. It is important to note that if it is considered Other Income, you will not be able to deduct any expenses that relate to your 1099-NEC income.
For tax purposes, self-employment income includes any part-time businesses or "side work" performed in which you are in business for yourself, rather than another person. You are also considered self-employed if you engage in business-like activities where you intend to make a profit.
To enter your 1099-NEC, please follow the steps below:
- Open your return.
- Search for 1099-NEC with the magnifying glass tool at the top of the page.
- Click on the Jump to 1099-NEC link at the top of the search results.
- Click Add a 1099-NEC.
- Enter the information as shown on your form.
- On the page titled Guess what? You can deduct expenses for the example work choose Yes, I have expenses to deduct (if you would like it to flow to a Schedule C) or No, I don't have expenses related to this income (if you would like it to flow to Other Income.
- If you choose to have this income flow to a Schedule C, you will see a page titled Self-employed 1099-NEC Income. You can select the Schedule C you are inputting this income for. If this is a new Schedule C for this year, you can add a new business on this screen.
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