My sister-in-law moved in 2018 from Illinois to Tennessee. The builder stated that we would close on her house in October 2018 and when he gave them the date we packed up a moving truck and left their rented house. When we got to Tennessee the builder was not able to have the house complete for the closing and they had to rent a hotel room for about 45 days and pay for the truck rental for the same time. The builder stated he would reimburse them the cost of the hotel and truck rental, which he did but not until March of 2019. She paid in December 2018 for the hotel and truck rental out of the funds from the sale of their house in Illinois.
They just received a 1099-misc for $10,560.00 from the builder for 2019. Do they have to amend their 2018 return or do they have to claim in on my 2019 return? The problem with claiming it on their 2019 return is that they live only on her husbands SS disability payment as their only income. Her husband is on medicare and lives in a wheelchair and she had to go on Obama care for 2019 and if they add this as income for 2019 it will effect her Obama care. She's upset because it will cost her money she doesn't have as she used SS as their only income basis when applying for Obama care.
Did this builder do this right by giving her a 1099-misc for her out of pocket expense that they reimbursed.
He reported it in box 7 and I believe it should be in box 3. Is box 3 the correct place to have this income reported
