My client races and sometimes receives contingency awards. It is called "YZ bucks" where the amount they win is received in the form of a check that can only be spent at the dealer on Yamaha parts - more like a coupon or rebate - anywhere from $50 to $250 per each race. This year they received a 1099MISC from Yamaha corporation with Non-employee Compensation of $2,400.
Because it is not actually money wouldn't it be "other income" as a prize?
Hobby income with $2,400 on Schedule A (expenses are MUCH more that $2,400)?
To avoid follow up for IRS I'm thinking a "dummy" schedule C to zero out and transfer to line 21.
They suggest their "friends" treat as a business but I won't go there!
Any other thoughts?
Because it is not actually money wouldn't it be "other income" as a prize?
Hobby income with $2,400 on Schedule A (expenses are MUCH more that $2,400)?
To avoid follow up for IRS I'm thinking a "dummy" schedule C to zero out and transfer to line 21.
They suggest their "friends" treat as a business but I won't go there!
Any other thoughts?
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