It's time to pay the piper for all that interest the shorts were kind enough to give me last year. Does anyone know where we're supposed to report it?
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I think you are correct. I am trying to figure out how to mark that 1099-MISC as Investment Income in Turbotax, so that it will offset it against my investment expenses. Anyone knows?
cpa
Active Member
You do not specify which box this income appears on the 1099-MISC.
If it is indeed interest income, then report the income on Schedule B so that it gets included with your investment income for the NIIT. At least that is what I would do for a client. And, I would show the income going in and out on line 21 with a description like "interest income reported on Schedule B."
If it is indeed interest income, then report the income on Schedule B so that it gets included with your investment income for the NIIT. At least that is what I would do for a client. And, I would show the income going in and out on line 21 with a description like "interest income reported on Schedule B."
adiggs
Well-Known Member
I use Fidelity and participate in their Fully Paid Lending Program. As of today, Fidelity doesn't have any of my shares borrowed to lend back out. It seems the appetite/demand for short positions has shrunk as the stock price has rallied, and Fidelity doesn't need me any more to satisfy demand.
Fidelity pulled my shares out of the lending pool mid-March, but they loaned them back out (at 0.75%) about a week ago.
If you show it both on Schedule B (which would go to line 8a?) and also on 21, wouldn't that duplicate it? I'm putting it on Sched B and 8a, but I'm guessing as long as you report it either way they won't mind too much.
Also OP, thanks for starting this thread, figured I'd google the question just to double check, and this thread popped up in the top ten.
cpa
Active Member
Perhaps I was not clear; let me restate: You make two entries on line 21:
XYZ company...................................................21,500
Less, amount reported on schedule B............-21,500
Line 21 nets to zero. However, the supplemental schedule that prints when there are more than one entry on line 21 will reflect both amounts that zero out.
So, no; you are not duplicating the income.
So, I hope never to have this income again, but for the past few years, I have filed it as a separate business (Schedule C). New this year is whether this business income is "qualified business income" and therefore I may take a 20% deduction under certain circumstances. I think it's investment income and therefore is not qualified. Confirmation of this would be very helpful.
Wow. Stopped doing that a few years ago and my head stopped spinning (most of the time) when doing my taxes.
Admittedly, my optimizations may now not be optimal.
Wow. Stopped doing that a few years ago and my head stopped spinning (most of the time) when doing my taxes.
Admittedly, my optimizations may now not be optimal.
cpa
Active Member
So, I hope never to have this income again, but for the past few years, I have filed it as a separate business (Schedule C). New this year is whether this business income is "qualified business income" and therefore I may take a 20% deduction under certain circumstances. I think it's investment income and therefore is not qualified. Confirmation of this would be very helpful.
Wow. Stopped doing that a few years ago and my head stopped spinning (most of the time) when doing my taxes.
Admittedly, my optimizations may now not be optimal.
It is not qualified business income. Substitute payments go on line 21 of Schedule 1. (I was mistaken last year--sugar happens when replying to an online forum without taking extra time to research.)
To be eligible for this deduction, the earnings must come from a trade or business. For 99.9962% of us, investing is not a trade or business.
cpa
Active Member
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