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New Member
posted Jun 6, 2019 5:12:37 AM

Where do I subtract the income that is reported on the 1099-MISC for a rebate that is not taxable income ?

I received a rebate (and 1099-MISC) from a Municipal Water District for the removal of turf and installation of drought tolerant landscape. I spoke with an agent from the IRS law department who researched the issue and told me that the rebate is not taxable income.
I entered information from the 1099-MISC. How do I subtract the amount of that income and add a statement referring to the information that I received from the IRS agent? I have his IRS ID number.

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1 Best answer
Expert Alumni
Jun 6, 2019 5:12:39 AM

You can show a negative number in Line 21 with the caption, “Rebate Income Adj.”  The negative number on Line 21 will adjust the income of the reported rebate.  

You can enter a negative income adjustment with the following menu path:

  1. Federal Taxes
  2. Wages & Income
  3. Less Common Income (image attached)
  4. Miscellaneous Income
  5. Start
  6. Other Reportable Income
  7. Start
  8. Other Taxable Income
  9. Description = “Rebate Income Adj”
  10. Amount = -$xxx

TurboTax will transfer this to your Form 1040, Line 21, Page 1.

2 Replies
Expert Alumni
Jun 6, 2019 5:12:39 AM

You can show a negative number in Line 21 with the caption, “Rebate Income Adj.”  The negative number on Line 21 will adjust the income of the reported rebate.  

You can enter a negative income adjustment with the following menu path:

  1. Federal Taxes
  2. Wages & Income
  3. Less Common Income (image attached)
  4. Miscellaneous Income
  5. Start
  6. Other Reportable Income
  7. Start
  8. Other Taxable Income
  9. Description = “Rebate Income Adj”
  10. Amount = -$xxx

TurboTax will transfer this to your Form 1040, Line 21, Page 1.

Level 2
Feb 15, 2021 9:40:47 AM

where can I find menu path you are talking about? I don't see where "federal taxes" is. Is it under one of those file, edit, view, tools, online, help tabs? FYI, I am using home and Biz edition if that matters.