Since you were
working as an independent contractor for a company, it is proper for that
company to include all the money they paid you on the Form 1099-MISC. That does not mean that you will be
responsible for paying taxes on that total amount though.
When you work on your Schedule C to report your income and
expenses as an independent contractor, you will report the full amount as
income when you enter the Form 1099-MISC.
Then, you will include the amounts that were reimbursed to you as an
expense. That way, you will not be
paying tax on the reimbursement because it will be subtracted from the
income.
You could enter it in the Less Common Expenses section, using the Other Miscellaneous Expenses category. Doing so will allow you to enter your own
description for the expense (such as reimbursement for supplies) so that you
can categorize it any way that makes sense to you.
