You can report the stock sale as an investment sale even though it was incorrectly reported on a 1099-MISC. The IRS matches income and will see that the amount on the 1099-MISC has been entered in your tax return. Keep your records about the shares that you received and the sale back to the company if ever needed. The buyback will be correctly added to your tax return by reporting this as though you received a 1099-B.
To enter the information without a 1099-B:
- In TurboTax, click on Wages and Income
- Scroll down to Investment Income
- Choose Stocks, Mutual Funds, Bonds, Other, and select Start or Update
- The first screen will ask if you sold any investments during the year, answer yes
- Did you get a 1099-B or a brokerage statement for these sales? Answer No
- Tell us about the sale, Click I'll enter one sale at a time
- The drop-down boxes can be filled out with the details of the stock sale
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