Question

When I enter my NY family leave in Form 1099-MISC under Other Common Income, Turbo Tax incurs a 15.3% self employment tax. How do I correct this ?

Forum|Forum|4 years ago
March 17, 2022
3 replies
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I received a 1099-MISC for NY Family Leave pay that I received. Turbo Tax is entering it as business income and I am incurring a 15.3% self-employment tax in addition to federal tax. My refund was reduced by $4439 on $11659 income.

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F

FangxiaL

It should be reported as other income:

To report the 1099-Misc form as other income:

Open or continue with the return
Click on Show more next to Other Common Income under the Income & Expenses section
Click on Start/Revisit next to Form 1099-MISC
Enter the information from the 1099-MISC form.
Select No, it didn't involve an intent to earn money. Otherwise, it is treated as self-employment income. See the screenshot below.

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J

jamesbernardoAuthor

Thank You ! I think that worked

K

kgaro113

We had the same problem as OP did, but these answers weren't posted back in early Feb when I first did our taxes. I came back to them this evening and did the steps indicated by @FangxiaL & @LenaH and it definitely helped when I was allowed to say this PFL income wasn't income that we intended to earn (this choice literally wasn't there back on Feb 8). However, we are still owing $5671 in taxes on ~$18,460.72 in PFL income -- that's an effective tax rate of 30.72%. Our usual tax rate is 14-15% and our marginal tax rate should only be 22% at most, so something still seems wrong. Why are we being taxed so highly on this PFL income? Is it as wrong as it seems? How do I fix it?

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JamesG1

Are you able to identify on what Federal form and line where the PFL income was reported? Does your tax return include a Schedule SE Self-employment Tax?

View the tax return entries at Tax Tools / Print Center / Print, save or preview this year's return / Include government and TurboTax worksheets.

[Edited 04/17/2022 7:52 AM PST]

@kgaro113

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C

Catanzaro24

Ss

DaveF1006

First of all, delete the entry you made completely. Make sure it's disappeared by going to the area where you made the entry. Then go to tax tools>tools>delete a form. Delete forms that have 1099 MISC, Schedule C , Schedule C worksheet. After this is done.

Log into your account
Select Wages and income>other income
Miscellaneous Income, 1099-A, 1099>start
Scroll to the bottom of the page to Other Reportable Income
Other taxable income, answer yes
Then give a brief description of the income and the amount listed. You might give the description title 1099 MISC Reporting Paid Family leave.

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J

jmw61289

This is not correct information. Followed your instructions to the letter and got to the point where you said to describe the income as "Paid Family Leave 1099" and the instructions on that page specifically say "Do NOT enter income reported on Form 1099-MISC".