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Section 409A applies to compensation that workers earn in one year, but that is paid in a future year. This is referred to as nonqualified deferred compensation. This is different from deferred compensation in the form of elective deferrals to qualified plans (such as a 401(k) plan) or to a 403(b) or 457(b) plan.
There is a 20% tax on the amount you enter from IRS Form 1099-MISC, Box 15b Section 409A income. This amount will be included in the total of Line 62 of your returnPlease remember to rate my service excellent once you have all the information you need. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!
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