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Author: tricomi Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: non-compete income Date: 3/17/2000 10:12 AM
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In 1999 I received non-compete income. Is non-compete income treated as ordinary income that I would report on my schedule D? Thanks in advance for any guidance.
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Author: shortamzn One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 31948 of 121061
Subject: Re: non-compete income Date: 3/17/2000 12:51 PM
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On what sort of informational form was the non-compete income reported?

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Author: tricomi Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 31972 of 121061
Subject: Re: non-compete income Date: 3/17/2000 5:40 PM
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I have not received any confirmation as to how non-compete compensation was reported to IRS. I believe it will be reported via the 1099 form. By the way, I have never worked for the company I have the non-compete contract. Thanks ....

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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 32055 of 121061
Subject: Re: non-compete income Date: 3/18/2000 2:07 PM
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<<In 1999 I received non-compete income. Is non-compete income treated as ordinary income that I would report on my schedule D? Thanks in advance for any guidance.>>

If you receive NTC income from a business asset that you sold, it's likely that the NTC income will be reported as the sale of a capital asset on Sch D.

But if you are simply receiving income for your agreement not to compete, it's generally simply ordinary income and should be included in your W-2.

TMF Taxes
Roy

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Author: bkcpa1 Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 32098 of 121061
Subject: Re: non-compete income Date: 3/19/2000 5:59 AM
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I am a CPA and had this particular situation this year. Income received as a result of a covenant not to compete is reported as "Other Income not subject to SE tax" on line 21.

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Author: hghcpa Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 32109 of 121061
Subject: Re: non-compete income Date: 3/19/2000 8:55 AM
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But if you are simply receiving income for your agreement not to compete, it's generally simply ordinary income and should be included in your W-2.
================

If you are not an employee then there is no reporting requirement for the payor - IE it is not a capital transaction reported on 1099-b nor is it a "service rendered" reported on 1099-misc.

Although some payors do report it as "other income" IMO it is not required.

Pete




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