1099-NEC Meal Reimbursements Taxable?

Forum|Forum|11 months ago
April 14, 2025
1 reply
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I am using Turbo Tax Deluxe.

I work for a company and get a W2 every year. I’m freelance. I’m not their employee. I do not have a business nor am I a corporation. I know nothing at all about Schedule C.

When I travel for work for them, I am 100% reimbursed for my meals and tips. For the first time ever, I received a 1099-NEC from them. Is this taxable? I can’t find the definitive answer to this question. When I enter the 1099_NEC into TT, it is taxing this amount at 25% (for example, $2000 adds $500 in tax). That seems excessive. Do I have to upgrade to TT Home & Business?

Please help! Thanks!

Vanessa A

If you have a W-2 you ARE an employee, unless you are a statutory employee. That means box 13 would be checked. If it is not, then you ARE an employee.

If you are a statutory employee, then you are treated as an independent contractor. Then you would need to file Schedule C. You can then deduct your expenses. in this case, yes, you would have to upgrade to TurboTax home and business.

The income on the 1099-NEC would be taxed as self-employment and subject to SE taxes which are 15.3% in addition to your regular ordinary taxes.

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