Question

1099-nec for 2024, received payment in 2025

Forum|Forum|1 year ago
February 16, 2025
1 reply
0 views

Hello,

Looking to determine how to report the following...

Self-employed

Cash basis

Issue:

> received 1099-NEC in 2024

> didn't receive payment from this 1099-NEC until 2025

? What is the best way to report this income; with a 2024 1099-NEC / receiving the associated payment in 2025?

Thanks for any assistance!

Tom

J

JamesG1

Ideally, you could contact the issuer and have them correct the IRS form 1099-NEC.

If that is not successful, you may enter the income reported on the IRS form 1099-NEC into your self-employment activity. Then immediately create an expense to back out the income.

In TurboTax Online, the IRS form 1099-NEC would be reported within the self-employment activity by following these steps:

Down the left side of the screen, click on Federal.
Down the left side of the screen, click on Wages and Income.
Under Your income and expenses, scroll down to Self-employment. Click the down arrow to the right.
Click to the right of Self-employment income and expenses.
At the screen Your self-employed work summary, click Edit to the right of the activity.
At the screen Let's enter any additional income, select Form 1099-NEC.
At the screen Here's your info, select Add expenses for this work to add an expense line to back out the income not received in the current year.

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T

taxtommyAuthor

JamesG1,

Thanks for the reply!

Could you explain a bit more on “creating an expense to back out the income”?

Does Intuit/TurboTax have instructions on how to handle this unique situation?

Once completed, I presume that there is no tax liability on this income for 2024?

How will I handle/report the amount received in 2025 with the “2024 1099-NEC” on my 2025 taxes?

Thanks again,

Tom

J

JamesG1

In TurboTax Online, you would go to your self-employment activity. Then follow these steps:

At the screen Here's your info, select Add expenses for this work.
At the screen Select any new expense categories you have, scroll down to Less Common and enter "Error" in the box.
At the screen Here's your info, click the pencil to the right of the expenses.
At the screen Let's enter the expenses, scroll down to the Description and enter "Posted in wrong year" and the amount. Click Continue.

You are reporting $100 as income for the Self-employment activity. Then you report $100 in expense for the Self-employment activity. The net is $0 taxable income.

The amount received in 2025 will be reported in your Self-employment activity as Other self-employed income. You may make an entry to explain the income.