Jury service, usable for IRA contribution?

[aaronc879]

$25/day plus mileage. No parking costs. Unless it was multiple weeks I wouldn't bother trying to get it counted as earned income.

[kaneohe]

Quote:

Originally Posted by pb4uski The IRS guidance of earned for EIC purposes is pretty definitive: I can't see that they would use a different definition for IRA contribution purposes. OTOH, Ed Schlott suggests that it is IF reported in Box 1 of Form W-2: Other sources of earned income include taxable alimony or maintenance payments, combat pay (even though it may be excluded from federal income tax), accrued vacation pay, director’s fees, jury fees, and scholarship or fellowship payments (if included in Box 1 of Form W-2). Where I would come down is if it is reported on Box 1 of Form W-2 then take it knowing that there may be some tax risk.... otherwise no.

any chance that the reference to Box 1 of Form W2 relates only to the shcolarship issue? https://www.schwab.com/resource-cent...rships-taxable

[pb4uski]

Possible. Unclear from the wording.

[rothlev]

Quote:

Originally Posted by Texas Proud First, it does not belong on a Sch C as that is for business income.... you are NOT in the business of being a juror.... not exactly correct Next, it will never show up in box 1 of a W-2.... the only way I can see that happening (and this is just a guess) is if you are on a grand jury which meets for a good amount of time... I was on a regular jury for 2 weeks and even sequestered when it was time to decided guilt... never go anything reporting that income... SOOO, has anybody ever received an IRS form reporting jury duty income?

any earned income ( not passive income, ie: a reward, a gambling winning, dividends or interest ) can be reported on sch. C if it is not on a w-2. You do not have to have a business. the key is was this income derived from work. Normally, jury duty goes on line 21 which is the line for other income ( ie gambling winnings rewards etc... ). However if the OP was on the jury for a long time and it was in his own best interest to report the income in sch. C, I think he has a strong case. In any event , unlikely the IRS would look twice.
( I am an enrolled agent ). However, putting this income on sch. C does subject it to self employment tax, which may negate the benefit of the IRA deduction. ( if the income is over $400.00 it is subject to the SE tax of around 15%

[Texas Proud]

Quote:

Originally Posted by rothlev any earned income ( not passive income, ie: a reward, a gambling winning, dividends or interest ) can be reported on sch. C if it is not on a w-2. You do not have to have a business. the key is was this income derived from work. Normally, jury duty goes on line 21 which is the line for other income ( ie gambling winnings rewards etc... ). However if the OP was on the jury for a long time and it was in his own best interest to report the income in sch. C, I think he has a strong case. In any event , unlikely the IRS would look twice. ( I am an enrolled agent ). However, putting this income on sch. C does subject it to self employment tax, which may negate the benefit of the IRA deduction. ( if the income is over $400.00 it is subject to the SE tax of around 15%

Well, I will disagree with you. The instructions for Sch C on the IRS website starts with this:

Use Schedule C (Form 1040) to report income or (loss) from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business.

How is being a juror meeting this definition? There is no continuity or regularity in being a juror... And it even states that a sporadic activity (a juror) or hobby does not qualify as a business...


BTW, I am a CPA and if someone insisted this be put on a Sch C I would tell them to go elsewhere...

[pb4uski]

I agree with Texas Proud.... I don't see jury duty... even if it was for a few months as a one-time thing... as being a "business" consistent with the instructions quoted above... it would be a sporatic activity and not meet continuity and regularity. Also, arguably wouldn't meet the primary purpose for income or profit... the purpose is because one is compelled to serve.

Retired CPA but not a tax practitioner.

In any event, it is a bit of a nit... why the OP would even be bothering with it is a mystery to me. We're talking about what... $500 or less?

ETA: Found this in Publication 17:

Quote:

Jury duty. Jury duty pay you receive must be included in your income on Form 1040, line 21.

Line 21 is other income.... so therefore, Schedule C would be inappropriate IMO.

[cranberryjoe]

I once was subpoenaed as a witness in a trial. After the trial, the clerk handed me a five dollar bill and apologized that it wasn't even enough to buy lunch. No tax forms were forthcoming, of course.

[ransil]

Just googled the current rate for my area, pay is $9 a day plus milage, parking is $1 /hr.

[gwraigty]

Quote:

Originally Posted by Texas Proud SOOO, has anybody ever received an IRS form reporting jury duty income?

I didn't. I was on a jury for 3 days @ $25 per day.

[bobandsherry]

Quote:

Originally Posted by jim584672 I saw that. But I see sites like Ed Slott saying the opposite.

Ed going to cover you for any penalty and interest? Don't think so. Anyone can have an opinion, IRS will have theirs and that's the only one that matters. Can't think it's worth the hassle.

[pb4uski]

Well, in reality it is the tax court's opinion that matters the most.

[Fedup]

I have Jury duty coming up in January, they sent a notice while I was on vacation. But honestly, it’s a very small amount at my age, I won’t have to sweat too much. It’s not going to IRA.

[bingybear]

jury duty pay goes on 1040 line 21. Self employment pay does not go on line 21. read instructions for form 8606 for taxable compensation (for IRA contributions and that income does not apply.

so, nope. It it did I would need to see if I could modify last year taxes for an $80 roth contribution.