How to properly file a 1099-NEC received from a Canadian company

The issue you're facing is common when dealing with foreign-sourced income reported on US tax forms. Since the 1099-NEC is from a Canadian company, you should still report this income even if your tax software is giving you trouble with the address. The easiest solution is to report this income on Schedule C (Profit or Loss from Business) as self-employment income. You don't actually need to enter the 1099-NEC form itself - you just need to report the income amount. On Schedule C, you can report the $2,700 as gross receipts without needing to enter the Canadian address that's causing the error. This income is still subject to self-employment tax (Social Security and Medicare taxes) even though it's from a foreign source. The IRS doesn't care where the money came from - they just want their piece of the pie!

I had a similar issue last year with a client from Toronto. After struggling with it for hours, I found taxr.ai (https://taxr.ai) which helped me figure out exactly how to handle foreign source income documents. Their system actually recognized my Canadian 1099-NEC and gave me step-by-step instructions for inputting it correctly. The key thing I learned is that foreign-sourced income reported on US tax forms has specific rules, and most regular tax software isn't great at handling these edge cases. The tool analyzed my specific situation and showed me how to report it properly without risking audit flags.

Just wanted to update after trying taxr.ai for my situation. I was dealing with payments from clients in Germany and Sweden that didn't fit neatly into any category in my regular tax software. The tool actually saved me from making a pretty big mistake! I had been reporting all my foreign income as "Other Income" on my 1040, but apparently that wasn't right for my consulting work. The system analyzed my payment documents and showed me I needed to use Schedule C and that I was missing out on legitimate business expense deductions I could have been taking. It even caught that one of my foreign clients had classified me incorrectly in their paperwork. Definitely worth checking out if you're dealing with any international income situations!

Hey, I dealt with exactly this problem last tax season! After 6 frustrating calls to the IRS that all ended in disconnections, I finally got through using Claimyr (https://claimyr.com). They have this system that basically holds your place in line with the IRS and calls you when an agent is ready to talk. Check out how it works here: https://youtu.be/_kiP6q8DX5c The IRS agent confirmed that I needed to report my foreign 1099-NEC on Schedule C as self-employment income, even though the payer was Canadian. They explained that the country of origin doesn't change your tax obligations - it's still taxable income in the US. The agent walked me through the exact process to make sure it was reported correctly.

I need to eat my words about Claimyr. After posting my skeptical comment, I decided to try it anyway since I've been trying to reach the IRS for weeks about a similar foreign income issue. It actually worked! Got connected to an IRS agent in about 2 hours. The agent confirmed exactly what others here said - you should report the Canadian 1099-NEC income on Schedule C as self-employment income. They also mentioned that if you have significant foreign income, you might need to look into FBAR requirements, though that's probably not necessary for just $2,700. For what it's worth, the agent said this is a common issue, and they see lots of people struggling with reporting foreign-sourced income correctly. Definitely worth getting the official word directly from them.

Another option to consider is using a different tax software. CashApp tax is great for simple returns but has limitations with international situations. I switched to FreeTaxUSA last year and it handled my British 1099 situation without issues. It let me enter "Foreign Address" and then fill in the details. If you're committed to using CashApp though, you could try entering a dummy US address for the company (like their US headquarters if they have one) and then include a note explaining the actual source is Canadian. Not ideal but might work in a pinch!

I'm confused about something basic here - why is a Canadian company issuing a 1099-NEC anyway? Isn't that a US tax form? When I worked with Canadian clients, they gave me T4A slips, not 1099s.

I went through this exact same situation two years ago with a consulting client in Vancouver. The key thing to understand is that even though the company is Canadian, if they're paying a US person (your wife) more than $600, they're required to issue a 1099-NEC under US tax law. For your tax return, you have a few options to work around CashApp's address limitation: 1. Report the income directly on Schedule C without trying to enter the 1099-NEC form itself - just include the $2,700 as gross receipts 2. Switch to a different tax software that handles foreign addresses better (TurboTax and H&R Block both handle this) 3. Contact the Canadian company and ask if they have a US mailing address or subsidiary you could use The most important thing is that you report the income - the IRS cares more about you declaring the $2,700 than the specific mechanics of how it gets entered. Since it's consulting income, it will be subject to self-employment tax regardless of the source country. Also keep in mind that if your wife plans to continue doing consulting work with foreign clients, it might be worth investing in tax software that handles international situations better from the start.

I'm dealing with a similar situation but with a twist - I received a 1099-NEC from a Canadian company AND they also sent me a T4A slip for the same income. Now I'm really confused about which form I should be using for my US taxes. Has anyone else encountered this double-reporting situation? The amounts are identical ($3,200 on both forms), but I'm worried about accidentally reporting the same income twice or using the wrong form entirely. The Canadian company told me they issue both forms "to cover all bases" for their US contractors, but that doesn't really help me figure out what to do on my end. Should I just use the 1099-NEC for my US return and ignore the T4A, or is there something more complex I need to consider here?

I've been following this thread with interest since I had a nearly identical situation last year. My wife received a 1099-NEC from a Toronto-based marketing firm for about $3,100 in consulting fees. After reading all the advice here, I want to emphasize what several people mentioned - the simplest and safest approach is to report this on Schedule C as self-employment income without trying to force the 1099-NEC form into tax software that can't handle the Canadian address. One additional tip that helped us: We included a brief note with our return stating "1099-NEC income from Canadian company reported on Schedule C due to software limitations with foreign addresses." Our tax preparer suggested this would help if the IRS ever had questions about the reporting method. The income is definitely subject to self-employment tax regardless of the source being Canadian. We learned this the hard way when we initially tried to report it as "Other Income" and got a notice from the IRS later requiring us to pay the additional SE tax. Also, keep good records of any business expenses related to this work - things like phone calls, internet costs, or materials used for the Canadian client. These can be deducted on Schedule C to reduce your taxable income from this source.