1099-NEC Nonemployee Compensation

Form 1099-NEC, Nonemployee Compensation

• Taxpayers should receive a 1099-NEC form, if they earned more than $600 as compensation for services they performed for an individual who is NOT their employer.
• Taxpayers who receive this form are considered independent contractors.
• Form 1099-NEC must be linked to SCH C (Profit or loss from a business) or SCH F (Profit or loss from a farm).
• Failure to link 1099-NEC to the proper form will result in failure to pay the proper amount of taxes.

Follow the instructions below to correctly enter the Form 1099-NEC:

1. Select Add Form.

2. Begin by typing 1099-NEC, into the search bar at the bottom of the All Forms and Schedules Menu.

3. Select Form 1099-NEC. Double-click to add the form.

4. If a joint return, choose New Taxpayer's or New Spouse's Occurrence.

5. Complete the 1099-NEC, filling in all applicable sections.

Linking Form 1099-NEC To SCH C

1099-NEC must be linked to the appropriate form either SCH C (Profit or loss from a business) or SCH F (profit or loss from farming). 1099-NEC's received for services or work a taxpayer performed should be linked to SCH C. 

1. Select the Link to (1040, SCH C, or F) box in box 1 of Form 1099-NEC.

2. Select Choices from the Active Options Window.

3. Select the SCH you wish to link to. If no SCH C is on the return select Unnamed Activity. If there is already a SCH C added, then you can select the SCH C you have already added and named. Double-click to link.

4. You can view the linked income on SCH C Line 1.