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Form 1099-MISC - Section 409A Deferrals
1

To enter or review the information from Form 1099-MISC, Box 15b Section 409A Income

  1. From within your TaxAct® return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then select Federal.
  2. Click Form 1099-MISC in the Federal Quick Q&A Topics menu
  3. Click +Add Form 1099-MISC to create a new Form 1099-MISC
  4. Click Form 1099-MISC Quick Entry to open the Quick Entry window
  5. Enter all of the applicable information from your Form 1099-MISC
  6. Close the Quick Entry window
  7. Assign the Form 1099-MISC you just entered to either Schedule C or Form 1040/Form1040NR, Other Income from the Assigned form or schedule drop-down list
  8. On the screen titled What type of income was reported on this Form 1099-MISC?, make the appropriate selection
  9. If you selected Other non-business income on the previous screen, check the box to confirm that the income is non-business income and is not subject to self-employment taxes

There is a 20% tax on the amount you enter from IRS Form 1099-MISC, Box 15b Section 409A income. This amount will be included in the total of IRS Schedule 2 (Form 1040), Line 8.

Note. Line 8 of Schedule 2 (Form 1040) may have items included from Other Taxes. When the form is printed, the total amount of Other Taxes will print to the left, and the text printed to the left of that amount will define the type of tax.

According to the IRS Instructions for Form 1040, you should include in the total on Line 8 any additional tax on income you received from a nonqualified deferred compensation plan that fails to meet certain requirements. This income should be shown in Box 12 of Form W-2 with Code Z or in Box 15b of Form 1099-MISC. The tax is 20% of the amount required to be included in income plus an interest amount determined under section 409A(a)(1)(B)(ii). See section 409A(a)(1)(B) for details. Identify as "NQDC."

If you also have federal and/or state tax withholding reported in Box 4 or 16, see Form 1099-MISC - Box 4 or Box 16.

Use the following instructions to view the Other Taxes - Supporting Details worksheet for Schedule 2 (Form 1040), Line 8.

Online Navigation Instructions
  1. From within your TaxAct Online return, click Print Center in the left column. 
  2. Click Custom.
  3. Click the checkbox(es) to the left of what you wish to print (the top section contains individual forms or schedules and the bottom section contains documents or worksheets). You may need to scroll down in the section to locate the item. 
  4. Click Print and then click the PDF link. Click the printer icon or save icon (available when you hover your mouse over the bottom of the PDF form) to print or save the PDF copy. 
Note: If you see a message indicating you have not paid your return fees, click the View/Pay link, which will direct you through the Paper Filing steps. Continue through the screens until you have processed the payment for your product fees and then repeat the steps to print. 

Desktop Navigation Instructions
  1. Click Forms in the menu bar
  2. Expand the Federal view and then the Worksheets view
  3. Select Form 1040 Other Taxes - Other Taxes Worksheet from the list

Note. Any links in the information above update each year automatically and will take you to the most recent IRS version of the publication at the time it is accessed.