Where Would I Enter Information from a 1099-NEC for Farm Income?
Information from a Form 1099-NEC related to farm income must be reported on your federal tax return, specifically on Form 1040, and may require additional schedules depending on the nature of the income.
Reporting Farm Income from 1099-NEC
- Box 1 (Nonemployee Compensation): If you received payments for services performed as a nonemployee (e.g., farm labor, consulting, or other services) and the payer issued a Form 1099-NEC, report the amount in Box 1.
- Self-Employment Tax: Income reported in Box 1 of Form 1099-NEC is generally subject to self-employment tax. You must report this income on Schedule C (Form 1040) if you are engaged in a farming business. Schedule C is used to report profit or loss from a business, including farming operations.
- Reporting on Form 1040: The total income from Schedule C (including farm income) is then transferred to Form 1040, line 12 (if you are using the standard form for 2025).
Important Notes for Farmers
- Farmers who receive payments for services (e.g., harvesting, equipment repair, or advisory services) from others and are not employees are considered nonemployees. These payments are reportable on Form 1099-NEC if they total $600 or more during the year.
- If you are a farmer and also operate as a sole proprietor, you must file Schedule C to report your farming business income and expenses.
- Payments to farmers for services performed are not considered wages and should not be reported on Form W-2. Instead, they are reported on Form 1099-NEC.
When to File Form 1099-NEC
- Payers must file Form 1099-NEC with the IRS by January 31 of the following year if they paid $600 or more in nonemployee compensation during the tax year.
- Recipients must receive a copy of Form 1099-NEC by January 31.
Source:
Instructions for Forms 1099-MISC and 1099-NEC (Rev. April 2025)
Disclaimer: Always verify details with the official Federal or State Department of Revenue Forms and Instructions. OLT (Online Taxes) provides guidance based on retrieved information but does not guarantee accuracy for individual circumstances.