Form 1099-MISC Box 3

[Lion EA]

Form 1099-MISC Box 3 Other income $50,000 to an individual. He tells me it "was a grant he was awarded (one time payment) to do work/research. He hasn't used hardly any of it yet...COVID stalled everything."

Self-employment? Schedule C? or Other Income? with or without SE?

[Lee B]

11 minutes ago, Lion EA said:

Form 1099-MISC Box 3 Other income $50,000 to an individual. He tells me it "was a grant he was awarded (one time payment) to do work/research. He hasn't used hardly any of it yet...COVID stalled everything."

Self-employment? Schedule C? or Other Income? with or without SE?

"to do work/research' kinda sounds like self employment Schedule C

[Lynn EA USTCP in Louisiana]

Have you read the grant documents ? 

[Lion EA]

Yeah, I'm getting SE from their wording, and just received the grant letter so will read it now.

Apparently, Duke offered to run the grant, but one of the two researchers was not hired by Duke, so they decided to run it themselves. With Covid, very little work/very little expenses during 2020.

I'll probably be back after I read...

[DANRVAN]

If the grant is for his own education and training, then it is not subject to SE tax.

If on the other hand he is performing service to the grantor, then SE tax applies.

[Lion EA]

He's not providing any service to the grantor. "...you will retain ownership interest in your Project while participating in the XYZ MegaGrants program, including the ability to publish your content on the platform of your choice." He's not working for XYZ. XYZ will own nothing.

Virtual reality for disaster resilience.

Duke had offered to run the grant, memorializing a contract back to 2020 when the funds were distributed, but my client turned them down. He's reopening that discussion.