TurboTax software offers guidance to taxpayers who need to report income shown on IRS Form 1099. Individuals may receive 1099 forms as a result of self-employment activities, and this income requires special handling for tax purposes.
Individuals who receive income through employment often receive W-2 forms to use when computing their income tax obligations. Those who work in a self-employment setting or as an independent contractor receive Form 1099-MISC instead.
TurboTax asks taxpayers who have 1099-MISC forms a number of questions that are used to find deductions that can offset money documented on Form 1099. These deductions account for expenses such as computer software that can cut into self-employment profit.