Why did I get a 1099-MISC, and do I need to report it?
There are a number of reasons for receiving a Form 1099-MISC. The most common is because you were paid for work you performed as a non-employee.
When employees get paid, they receive a W-2 at year's end. Instead, non-employees receive a 1099-MISC. The IRS also refers to non-employees as independent contractors or self-employed.
The 1099-MISC also reports miscellaneous income that you might get from other things, like prize or award money, rent payments, and more
Just like a W-2, the 1099-MISC reports your income to the IRS and needs to be entered on your return.
Other income reported on 1099-MISC
In addition to non-employee income, Form 1099-MISC is used to report other types of income, such as:
- Payments of $600 or more for services performed for a trade or business by people not treated as its employees (such as subcontractors).
- Prizes or awards;
- Rent payments
- Royalty payments;
- substitute dividend and tax-exempt interest reportable by brokers ($10 or more;
- State and federal tax withheld in conjunction with any of the other activities reportable on the form;
- Payments to a physician, physicians' corporation or other supplier of health and medical services, issued mainly by medical assistance programs or health and accident insurance plans;
- Payments to fishing boat crew members coming from sale of catch;
- Crop insurance proceeds.
The income on a 1099-MISC should always be reported. Where you enter it in TurboTax depends upon what it's for. TurboTax guides you to the correct place for entering each type of income.
- Form 1099-MISC, Miscellaneous Income
- What is Non-employee Compensation Income (Box 7 on my 1099-MISC)?
- Do I need any other information before entering my 1099-MISC?
- Which TurboTax editions Support 1099-MISC Expenses on Schedule C?