Forms 1099B and 1099-NEC

[CABBATIELLO2]

Hello, 

What to do if I received 1099-NEC from my former employer and 1099-B from the Broker for the same transaction? 

According to my former employer I should use only the 1090-NEC because the 1099-B that the broker sent me is for information purpose only and that I should not enter it on my tax return.

According to the broker, I need to use the 1099-B on my tax return or the IRS will penalize me. 

If I use both forms, the system deducts double. 

Please help!

Thank you

[ThomasM125]

You probably sold company stock and the ordinary income component of the sale is listed on your W-2 form, and that amount is not reflected on your form 1099-B.

You should enter your 1099-B form in TurboTax, but adjust the gain to reflect the income reported on your W-2 form. You will see an option to adjust the gain on your form 1099-B when you enter the sales proceeds and cost as follows:

[CABBATIELLO2]

Thank you Thomas, but how about the information I got from my former employer on the 1099-NEC? I was not working anymore at the time of the transaction and therefore the transaction is not reflected on the W2. 

Thank you

[CABBATIELLO2]

Hi again Thomas. I followed your advise but I need to enter a code in order to continue. I looked at all the codes and I don't see any one that applies to the following statement: "Received a 1099-B and 1099-NEC"

What code should I use that explains the reason for the adjustment?

ps. I was not employed at the time of the sale therefore there is no W2 involved. 

Thank you for your help!

[MaryM428 · Accepted solution]

In this highly unusual situation, here is a way to enter the information into TurobTax without being double-taxed on the income.

Enter the 1099-B and do not make any adjustments

Enter the 1099-NEC exactly as it is on the form

Now enter anther copy of the 1099-NEC with the amount as a negative number to cancel out the 1099-NEC
 

Follow there steps:

• Search for 1099-NEC and jump to 1099-NEC
• Add another 1099-NEC
• Type in the 1099-NEC, but for the amount put a minus sign in front of the number
• For the reason, type:  Remove double taxation from 1099-B and 1099-NEC
• No expenses to deduct

That will let you input both forms without being double taxed on them.  

[CABBATIELLO2]

Thank you very much Mary, it looks like it worked. I appreciate your help!