You can negate the 1099-MISC income (assuming it's reported in box 7 and I "think" also if reported in box 3) by entering the the 1099-MISC first, and then showing it as a "refund" to the client in the Returns and Allowances section. For the SCH C, the returns and allowances section is in the same section where you report the business income. That will "offset" the double reporting and it also won't be included in the gross receipts that way.
