After much discussion, we feel more clarity is needed. So I am going to assume that your w2 is correct and contains all of your earned wages. I believe you are stating you should not have received a 1099-NEC as that is income not received. If this is the case, there are things you need to do.
- Report the correct income on your tax return.
- You will need to include all documents received. Carefully enter the NEC, let me give you the steps below.
- subtract out the 1099-NEC that you dispute. Follow the steps below.
- Disclose your position that the income is not taxable on Form 8275, Disclosure Statement - IRS. This will make your return ineligible for efile.
- Report them on Form 3949-A. See How Do You Report Suspected Tax Fraud Activity?
Since the 1099-NECis not a business, you have to mark:
- no intent to earn money
- mark that the income is only for this tax year, 2023 .
- Otherwise the program will think it is recurring income and a business and charge Medicare and Social Security taxes
Subtract the 1099-NEC
1. Miscellaneous Income, 1099-A, 1099-C, Start
2. Scroll to the bottom
3. Other reportable income, Start
4. Other taxable income?
5. Select YES
6. Description wrongful 1099-NEC
7. Amount, enter your negative amount
8. continue
[Edited 3/1/2024| 3:38 PM PST] @wldncrzy1971 If the assumptions are wrong, please reach back out.
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