jeffmcpa2010
Level 11

Here's is what it comes down to.

Possibly/Probably/Likely it should have been on a W-2 which could save him some SE tax depending on other earned income etc during the year.

Does he want to approach the former boss about changing the form to a W-2, ( and possibly be asked to pay back the SStax and other payroll taxes that would have been withheld?

Other possibility the irs instructions for schedule c include the following in the first paragraph

"An activity qualifies as a business if
your primary purpose for engaging in the activity is for income or profit and you are
involved in the activity with continuity and regularity. For example, a sporadic activity, not-for-profit activity, or a hobby does not qualify as a business. To report income
from a nonbusiness activity, see the instructions for Schedule 1 (Form 1040), line 8i."

You may conclude that he does not qualify as a trade or business due to lack of continuity and regularity. If so you can record the NEC on the Nonemployee Compensation Worksheet, and if you think it is the correct thing to do select the "other income" box under within box 1.

 

0 Cheers