I'm hoping someone can help me with this: I own 2 small businesses. One is a sole proprietorship, which I'll call Company A, and the other is an LLC with no employees, which I'll call Company B. In both business I need to hire independent contractors. The two businesses are very similar and often do the same type of work, so much so that sometimes new clients aren't even aware that I have the other business and/or do not differentiate between the two unless I point out that they are 2 different businesses.
Recently a new client hired me to do I job that I would normally contract through Company A, so I paid my independent contractors from Company A's account. However, I accidently sent the client a Form W9 for Company B, so she wrote out the check to Company B. The problem now is that I have a business expense for Company A (which I'll report on Form 1099NEC for my independent contractors) related to income for Company B. From my own point of view, it doesn't matter since I am both businesses, but will this cause a problem with the IRS? If so, is there some way to reconcile this so the expense and the income appear for the same business to avoid problems with the IRS, without me or my client having to rewrite any checks?
Thanks!!!
