If your construction business gets a 1099 for the value of meals "awarded" to the company, the 1099 full amount should be reported to match IRS records.
Then if you did not actually get the full amount of the 1099 or the Fair Market Value was less than the 1099 amount you should make an adjusting entry to the income and reduce it by the difference in the 1099 and the Value received.
For example if I get a 1099 for a car I won for $12,000 and the car is immediately sold for $11,200, then I would report the 1099 full amount ($12,000) and take a $800 reduction in income so the net reported is $11,200.
