The 1099-MISC form is used to report different types of payments. This video will help you more accurately report these payments on your tax return.
For information on the third coronavirus relief package, please visit our “American Rescue Plan: What Does it Mean for You and a Third Stimulus Check” blog post.
Note that Form 1099-MISC has been replaced by Form 1099-NEC beginning in 2020 for non-employee compensation.
Hello, I’m Jill from TurboTax, with important news for taxpayers who received a 1099-MISC form this year.
If you earn income that isn’t from employment, you may be receiving a 1099-MISC in the mail before your tax return is due on April 18, 2022. However, since the 1099-MISC is used to report different types of payments, it’s important to understand how to read your form so you can report it correctly on your tax return.
For most taxpayers, the information on the right side of the 1099-MISC in boxes 1 through 18 is most important, but it can also be a little confusing. One of the more common uses of the 1099-MISC is to report the income you earned as an independent contractor in box 7.
If you provide services to a trade or business that pays you at least $600 during the year, they will report these payments in box 7—which you must report on a Schedule C or C-EZ attachment to your 1040 form.
If you work as an attorney, you may receive 1099-MISC forms with amounts reported in box 7 from some of your clients. However, you will only receive 1099s from business clients that make annual payments to you of $600 or more.
Providing services isn’t the only time you will receive a 1099-MISC.
If you own commercial real estate, your tenants will report the annual rent payments they make to you in box 1 of the form. And although this amount is taxable, you can reduce it by the expenses you incur to maintain and rent the property.
Some of the boxes on the 1099-MISC report other types of income that you may need to report on a tax return. Box 2 will report the royalty payments you receive of $10 or more and box 3 may report certain prizes and awards you receive or the portion of a lawsuit settlement that isn’t tax-exempt. And if the issuer of your 1099-MISC withholds taxes from your payments; box 4 will report the amount withheld for your federal taxes and box 16 will report the amount for your state taxes.
Don’t worry about knowing which tax forms to fill out when you are self-employed, TurboTax Self-Employed will ask you simple questions about you and your business and give you the business deductions you deserve based on your answers. TurboTax Self-Employed uncovers industry-specific deductions. Some you may not even be aware of.