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Level 2
July 6, 2020
Question

Does a car salesman who is an employee have to pay SE tax on his 1099 Misc. income listed under other income

  • July 6, 2020
  • 2 replies
  • 19 views

Car salesman who gets a w-2 also got a 1099 misc. with an amount in box 3.

Does he need to pay SE tax on this or can it be reported under other income on line 7a?

IRS ruling?

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2 replies

qbteachmt
Level 15
July 6, 2020

Who is the payer name on the 1099? What is the reason for the payout? Example:

Prize from the Automobile factory or some honest competition? Box 3 is fine, and that is Other Income.

Or, Bonus from the employer? Box 3 is an error; it should be on the W2 and should have been run through as payroll.

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abctax55
Level 15
July 6, 2020

You can find your own IRS ruling.... but a good place to start searching would be for "spiffs"

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