Question

Board of Director income

Forum|Forum|2 years ago
February 3, 2024
1 reply
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We received a 1099-NEC for income for my wife being on bank board. Is that just "other income" or is that subject to self employment tax. I've seen answers steering me potentially in both direction.

Thanks...

KrisD15

1099-NEC is Non-Employee Compensation and is treaded as Self-Employment income.

Had they used 1099-MISC, it could be labeled as something else, but the 1099-NEC is specific to Self-Employment.

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A

AeroFlyer711Author

So when TT asks me to enter her "Business" info for Sch C (description, name, address, EIN, etc.) what would go in there? The first question in the section aske for a "description of your principal business or profession" but this money isn't coming from her main job/profession.

PatriciaV

Employee

Enter Form 1099-NEC under the Other Common Income topic, and use whatever description is accurate: "Board stipend," for example. After you enter the amount, the next screen will provide "uncommon situations" for this income. Check the box for "This is not money earned as an employee or self-employed individual, it is from a sporadic activity or hobby."

This choice avoids the need for Schedule C and will report the income on Schedule 1 Line 8z Other Income. The total from Schedule 1 Line 10 flows to Form 1040 Line 8 as ordinary income.

@AeroFlyer711

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