Has anyone n here figured out how to handle the PayPal 1099 and 1099's from MSC?

I'm getting ready to do my taxes. Has anyone figured out how to handle the issues with the 1099's from PayPal and from other companies? Also can we use the IRS free site? would it be better to use Turbo Tax to void any audits?

Edited 1 time(s). Last edit at 03/15/2025 11:26PM by johnb974.

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I'm trying to figure out the proper way to handle this right now too. All of my income is listed on the 1099-K, but each company also sent me 1099-NEC for the same exact same income. I had originally thought that companies who issued payments via PayPal wouldn't send their own 1099, but this is new to me too. I use Turbo Tax, it always worked good for me, but was able to use one of the IRS's free file options last year.

@hotrod22 wrote:

I'm trying to figure out the proper way to handle this right now too. All of my income is listed on the 1099-K, but each company also sent me 1099-NEC for the same exact same income. I had originally thought that companies who issued payments via PayPal wouldn't send their own 1099, but this is new to me too. I use Turbo Tax, it always worked good for me, but was able to use one of the IRS's free file options last year.

How did Turbo Tax handle the different 1099's?

I know last year Turbo Tax asked if I received any 1099-K forms, I didn't have 1099-K then, so I don't know if it asks about double reported income or not. They do have a nice system where you enter each of the 1099s one at a time and you can easily see how all of your income lines up. Afterwards, it will ask about 1099-K; but that will be new to me this year. Hopefully it can sort the differences.

@hotrod22 wrote:

I know last year Turbo Tax asked if I received any 1099-K forms, I didn't have 1099-K then, so I don't know if it asks about double reported income or not. They do have a nice system where you enter each of the 1099s one at a time and you can easily see how all of your income lines up. Afterwards, it will ask about 1099-K; but that will be new to me this year. Hopefully it can sort the differences.

Let me know how they handle it.

I listed all of the 1099s including Paypal and then I deducted it on Schedule C under Other Expenses. I listed it as duplicated reported income from PayPal and put it the amount reported from paypal. This is what I did last year also. I used H&R Block online and paid for someone to review it and he said that was correct.

I don't think you can use the free site if you need to use schedule C. Not 100 percent sure about that though.

@Datagirl wrote:

I listed all of the 1099s including Paypal and then I deducted it on Schedule C under Other Expenses. I listed it as duplicated reported income from PayPal and put it the amount reported from paypal. This is what I did last year also. I used H&R Block online and paid for someone to review it and he said that was correct.

I don't think you can use the free site if you need to use schedule C. Not 100 percent sure about that though.

I will do that when I do my taxes.

Be mindful to deduct all of your reimbursed expenses on Schedule C as well if they are included in your 1099 K from Paypal.

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Has anyone n here figured out how to handle the PayPal 1099 and 1099's from MSC?

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