Customer pays me via Paypal(1099MISC). Paypal sends me a 1099-K that includes the amt paid by customer. Can I report difference under Other Biz Income only?

[hueylee99]

I have a customer who pays me via Paypal and I received a 1099-MISC tax form from them.  However, Paypal also sent me a 1099-K that includes the amount paid by customer. So what I did was subtract the amount from the customer's 1099-MISC Box 7(nonemployee compensaton) from Paypal's 1099-K Box 1a (Gross  amount of payment card) to get the difference of payments received on the 1099-K.  So the question is, can I report difference under Other Business Income?

[JulieCo · Accepted solution]

Yes, record the 1099 MISC, but then you enter the remainder of your business income in the General Income line on the self-employed business income entry screen.  See the sample screenshot below.  Therefore, this will include all of your income in the Gross Receipts (line 1) of Schedule C.