If you are a only Proprietor or an independent contractor, i.e. “self-employed”, you may receive one or more Forms 1099-MISC. If you are not sure how to report the income from these forms on your personal income tax return in TurboTax Home and Business, this article is for you. Here are the steps to properly report 1099-MISC income. If you don’t do this right, the IRS will contact you, because they will also receive a copy of every 1099-MISC you receive, and the IRS computers will compare the total income on your Schedule C with the total income on the 1099’s. Nuff said?
1. Open up your Schedule C by clicking on this form in Forms view.
2. Scroll down the page until you come to Part I, Income. The second line should read “QuickZoom to Form 1099-MISC”. Click on that.
3. Create new copy. go into the payer’s name. Input the name of the business that gave you the 1099-MISC.
4. You should now see a new screen entitled “Miscellaneous Income.” The payer’s name should already be filled in the first field. Tab down to the next line and input the payer’s EIN or social security number, whichever one appears on the 1099-MISC. You can leave the account number field blank; it’s not basic.
5. If this is your spouse’s 1099-MISC, check the Spouse’s 1099-MISC box. If it’s yours, leave it blank.
6. Scroll down to Box 7, Non-employee compensation. This is where most self-employment income is reported. Input the amount from Box 7 in this field. Be sure to input the amount correctly! This is the amount that the IRS computers will be checking.
7. Required: double-click to select the form on which to report this income. Double click on this field and a screen will pop up which says Select Schedule C. If you’ve only got one Schedule C, the business name from that Schedule C will appear by default. Just click on “Link” and the dollar amount will automatically move to Schedule C, Line 1. If you have more than one Schedule C, select the one for which this 1099-MISC was received.
8. Go back to your Schedule C and make sure the 1099-MISC amount is there. Look on the line that says “Income transferred from Form 1099-MISC worksheet or W-2 income worksheet”. This line should now include the amount your just entered.