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Ed Johnson
Ed Johnson, Tax Preparer
Category: Tax
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Experience:  GPHR Cert; U.S. Treasury Tax Advocacy Panel appointee
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i have a 1099 mis for spiffs (bonus cash that is paid for selling

Resolved Question:

i have a 1099 mis for spiffs (bonus cash that is paid for selling name brand product at the store I work at) Under what heading do I put this under--- The mfg. pays the spiff not the company I work at. I think it is entered as contest winnings ????
Submitted: 5 years ago.
Category: Tax
Expert:  Ed Johnson replied 5 years ago.

DearCustomer

 

what box is filled in on the form 1099-MISC?

Customer: replied 5 years ago.
box 7 on 2 1099's for a combined total of $3365.00
Expert:  Ed Johnson replied 5 years ago.

Dear go55,

 

Treat this as a 1099 income under the section in Turbo Tax for personal income, not the business income section.

 

THEN select the following options.

 

after entereingthe 1099 informatiion,

 

select my wages, prizes, etc instead of W-2. It may seem confusing because they really are not an employer,and the turbo tax section lanaguge makes it seem that is what is meant.

 

Then on the next page select in answer to: XXXXX GET THIS MONEY FOR:

 

select either the most nearly correct reason for the money, or other--not on list.

 

If you did not peform services for the vendor who paid you the money, then TT will prompt you to get a amended 1099, and move the money to other income, box 3 and allow you to finish.

 

It is important to charachterize this income.

 

If you did not perfomr services for them then it should have been reported in box 3.

 

It could be considered that you performed services by selling their products.

 

make sure you use the guide me function in TT.

 

If you were considered to have been peforming a service for the vendor who paid you the money, then you would half to list this as self emlpoyment income and report it on schedule C. TT will guide you.

 

how do you know? a prize is based on competition between sales people where who sold the most gets a prize or award.

 

However a payment in return for selling a certain numbern of products that is as a percentage of sales, is for service. (you sold product) and is considered a bonus.

 

 

 

 

 

 

Ed Johnson, Tax Preparer
Category: Tax
Satisfied Customers: 10760
Experience: GPHR Cert; U.S. Treasury Tax Advocacy Panel appointee
Ed Johnson and 3 other Tax Specialists are ready to help you

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