I have a main job which withheld taxes for 2007. I also received non-employment compensation (on a 1099-MISC) from another company. I am wondering how and if I can deduct expenses that I incurred for my 1099-MISC job.
I stated my deductions on the "itemized deductions" form, but the only place they have on there for employment expenses is for employees. And the payments that I received were "non-employment" compensation. How do I go about deducting my expenses for this job?

1099-Misc income is reported on schedule C (Form 1040). It is also subject to 15.3% SE tax.

How you will treat the 1099-Misc income, read: Your U.S. Tax Return: W2 or 1099: Employee or Independent Contractor.

You not report income from the Form 1099-MISC on the Schedule C, you also report the expenses you incurred while earnig that income. It is much easier to claim such expenses because there is NO 2%-of-AGI floor to beat (a requirement to claim employee business expenses on Form 2106 and Schedule A).

In fact, it is so easy that it is often abused, and the IRS IS aware of this abuse, so make sure you have a solid foundation in fact before claiming such expenses.