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Client received a 1099-misc with box 2 royalties having a value. On the backside they give supplemental reporting where they give you the gross revenue, deductions, and net income. My question on Sch E can I report the deductions then report the net income on the 1040.
Thank you for your help in advance.
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I put the gross royalty amount at the top of Sch E, then list the deductions down in the expenses, the net flows to the 1040
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Here is the help article, expand the section that explains how to link your entered 1099-Misc to Sched E:
You didn't mention what type of royalty, if that is oil & gas?
Don't yell at us; we're volunteers
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I put the gross royalty amount at the top of Sch E, then list the deductions down in the expenses, the net flows to the 1040
♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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And don't forget the depletion deduction, which will not be shown on the 1099.
When they come from Oklahoma, there may also be state income tax withheld, requiring a state return if it's enough to bother with.
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I did forget about the depletion, thank you all for your answers. I get a lot of good information and learning tips from this group, especially when I do not see most of these situations on a regular basis.