💡What Is a Statutory Employee?

The term "statutory employee" refers to an independent contractor who is treated as an employee for tax withholding purposes.

Earnings as a statutory employee are reported as income in Schedule C, rather than wages on Form 1040. If a taxpayer receives a Form W-2 marked as a statutory employee (box 13)

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Here's how to enter it on the software:

1. From the left-side widget, search for W2, then go to Form W-2, Wage and Tax Statement Now as shown below

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Or to pull up Form W-2, go to Income then Form W-2

2. When on Form W-2, enter all the information regularly, then scroll down to Box/Section 13, then check the box for Statutory Employee
(checking this box makes the wages entered on W-2 not show under 1040 wages, however, you should still enter all the information on Form W-2 the same way)

3. Click Continue

4. When you see this message informing you that you checked the Statutory Employee box and that income (Box 1 on W-2) has to be reported on Schedule C, click Create a Schedule C.

5. From the Schedule C menu, choose Income

6. Enter the amount found on W-2 Box 1: Wages in the Income Reported to you on Form W-2 as Statutory Employee box.

It is important to note that:

1. Income as a statutory employee should NOT be combined with self-employment income. If you should report Self-Employment income, you must file a separate Schedule C for it. Schedule C for Statutory Employment shouldn't be combined with any other Schedule C.

2. Do NOT carry statutory income to Schedule SE.
Social Security and Medicare Tax should have been withheld and reported on Form W-2, normally.