tagteam and I interpreted your question differently. I assumed that the extra money was for the cost of the materials that you picked up, and you paid that amount to the supplier of the materials. tagteam assumed that the extra money was additional compensation to you for picking up the materials. Either way, the 1099-MISC is correct. If tagteam's understanding was correct, then you did earn the extra money by performing the service of picking up the materials, and you do not have a business expense for the materials. In that case, you should be paying tax on the additional money.
