If you received an erroneous 1099, You have several choices (I would do #3):
- Ideally, you get a corrected 1099-NEC from the payer
- Report only the correct amount. Attach a copy of the 1099 and a statement explaining the circumstances. You can't e-file. From the IRS instructions for form 1099-Misc: Form 1099-MISC incorrect? If this form is incorrect or has been issued in error, contact the payer. If you cannot get this form corrected, attach an explanation to your tax return and report your income correctly.
- Report all the Income, on the 1099-NEC, on schedule C and take a deduction for the difference, under other expenses, call it something like "adjustment for erroneous 1099-NEC "
- Report only the correct amount and hope you can explain it away when & if the IRS contacts you
