I need to be able to give an appropriate answer to the doctors that call my company asking why the student loans that we pay for them are located in box 7 instead of box 3.

Follow

Educational benefits for contractors, as opposed to employees, are counted as income to the contractors and therefore correctly included in box 7, nonemployee compensation, of Form 1099-MISC. See IRS Instructions for Form 1099-MISC.

We confirmed this with the IRS information reporting customer service center's Ms. McClure (ID#1001557). Ms. McClure cited IRS Publication 15b as providing information about educational benefits. There is an exemption of up to $5,250 for employees, but not for contractors.

Have more questions? Submit a request

Comments