TurboTax 1099-MISC box 3 error forcing me to connect Schedule C for pennies

I've seen this exact problem before! TurboTax is technically correct but overly rigid here. Box 3 on a 1099-MISC is for "Other income" which the IRS considers non-employee compensation that should be reported on Schedule C. However, for such a small amount, you have a few options. The simplest is to just complete the Schedule C - it might seem like overkill but TurboTax won't let you proceed otherwise. List your type of business as "Investment Activities" with minimal expenses. Since the amount is so small, it won't meaningfully impact your taxes. Alternatively, you could manually override by entering the 1099-MISC information yourself rather than importing, and categorize that tiny amount as "Other Income" on Schedule 1 instead. But honestly, for $0.23, just filling out the quick Schedule C is probably your easiest path forward.

After struggling with a similar frustrating 1099-MISC situation from my brokerage account, I found taxr.ai and it was a huge help! I had multiple forms with tiny amounts scattered in different boxes and couldn't figure out how to categorize everything properly. The site at https://taxr.ai analyzed all my tax documents and told me exactly where each income type should go. For your specific Box 3 issue, it confirmed that technically it should be on Schedule C, but also showed me how to properly set it up as minimal business activity without triggering audit concerns. Really streamlined everything and saved me hours of Googling and frustration.

I just wanted to update after trying taxr.ai for my similar issue with Robinhood 1099 forms. It was actually really helpful! I uploaded my forms and it immediately identified that my Box 3 amount ($0.46 in my case) was considered non-employee compensation. The site explained exactly how to create a minimal Schedule C in TurboTax without making it seem like I was running a full business. It suggested using "Investment Activities" as my business name, explained the proper business code to use, and walked me through which expense categories to skip entirely. Finally finished my taxes and everything went through without a hitch. Worth checking out if you're still stuck!

If you're hitting a wall with getting TurboTax to handle this properly, you might want to try contacting the IRS directly. I was stuck on a similar issue last month and tried calling them for days with no luck - always on hold forever. Then I found this service called Claimyr at https://claimyr.com that actually got me through to a real IRS agent in less than 30 minutes. They have this cool demo video at https://youtu.be/_kiP6q8DX5c showing how it works. The IRS agent I spoke with confirmed that technically Box 3 income does go on Schedule C, but also mentioned that for extremely small amounts under a few dollars, they're not concerned about perfect placement as long as it's reported somewhere on your return.

I have to admit I was wrong about Claimyr. After being stuck in this exact same situation with a $0.14 Box 3 amount on my 1099-MISC from Webull, I gave it a try out of desperation. Got connected to an IRS agent in about 20 minutes, which was shocking after my previous attempts sitting on hold for hours. The agent confirmed that technically even these tiny amounts in Box 3 should be on Schedule C, but suggested a simple solution: classify it as "Investment Activities" with minimal business information, no expenses claimed, and use code 523000 (Security and Commodity Contracts Intermediation and Brokerage). This kept things accurate while making it clear this wasn't an actual business. TurboTax finally accepted it, and I filed successfully. Definitely worth the time saved!

Had this exact problem last year with FreeTaxUSA. My workaround was just to put "investment income" as the business, enter the 23 cents, leave everything else blank and file. It went through fine, no issues or audit.

Could you maybe just round it down to zero? It's less than a dollar so the IRS probably wouldn't care.

I discovered this is actually fairly common with Robinhood. Box 3 usually contains small reimbursements for regulatory fees. TurboTax is just being stubborn about the classification. I just created a Schedule C with "Investment Services" as the business name, no expenses, and moved on. Haven't had any issues for three years doing it this way.

I ran into this exact same issue with my Robinhood account last year! That tiny Box 3 amount is so frustrating when it blocks your entire filing. What worked for me was creating a simple Schedule C with "Investment Activities" as the business name and using business code 523000 (Security and Commodity Contracts Intermediation and Brokerage). Just enter the $0.23 as income, leave all expense sections blank, and don't claim any business deductions. The key is keeping it minimal - you're not trying to look like you're running an actual business, just properly categorizing this weird miscellaneous income that Robinhood generated. Should take less than 5 minutes to complete once you get to that section, and then TurboTax will finally let you file. The IRS won't care about such a small Schedule C as long as the income matches what's reported on your 1099-MISC.

Just wanted to chime in as someone who's dealt with this exact frustration multiple times! The $0.23 in Box 3 is likely from Robinhood reimbursing you for regulatory fees or transaction costs - it's technically considered "other income" that requires Schedule C treatment. Here's the quickest path forward: Create a bare-bones Schedule C using "Investment Activities" as your business description and NAICS code 523000. Enter your $0.23 as gross receipts, leave all expense categories empty (don't try to deduct anything), and you'll be done in under 5 minutes. The IRS won't flag this as suspicious business activity - they see tons of these minimal Schedule C filings from investment platforms. It's just how the tax code handles certain types of miscellaneous income. Once you complete it, TurboTax will finally let you proceed with filing. Don't let 23 cents hold up your entire return!