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March 4, 2021
Question

I received 1099-MISC from income received from an inherited deferred compensation plan in a year after death of the orig holder. How can I indicate this is not taxable?

  • March 4, 2021
  • 1 reply
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I found a previous thread on TurboTax from last year that indicated you could mark that you could check a box indicating this 'was not received from work like your main job' but this isn't an option within the 1099-MISC section.  My understanding is that by marking this was not from work, the $ will go onto a Schedule 1 as 'other income' and not be shown as self-employed income since in this case, it is not.

1 reply

LenaH
March 6, 2021

The question you are referring to follows another question regarding 1099-MISC uncommon situations. Please answer the questions for the 1099-MISC as written below. On the screens that follow, you will also be able to get to the correct screen so the inherited deferred compensation benefit will not go to self-employment income. 

 

Please follow the instructions below:

  1. Open or continue your return, if you're not already in it.
  2. Search for 1099-misc and select the Jump-to link.
  3. Edit your 1099-MISC.
  4. Continue past the amounts already entered.
  5. Describe the reason for this 1099-MISC as death benefit.
  6. Answer None of these apply on the screen Does one of these uncommon situations apply?
  7. Answer No, it didn't involve work like my main job for the question Did this involve work that's like my main job?
  8. Answer You got it in 2020 for the question How often did you get this income?
  9. Answer No, it didn't involve an intent to earn money for the question Did this involve an intent to earn money?
  10. Answer the remaining on-screen questions.
  11. Your 1099-MISC will flow to Other Income

Next, please make sure to delete any Schedule C or associated self-employment forms in your return (if they were populated previously). 

  1. Search for Schedule C with the magnifying glass tool on the top of the page.
  2. Select the Jump to Schedule C link in the search results.
  3. Select No to the question Did you have any self-employment income or expenses? 
  4. Click on Tools.
  5. Click on Delete a Form
  6. Scroll down to your forms and look for forms you need to remove and click Delete
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