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zhill1
New Member

Do I need to 1099 a large refund to a customer for materials they paid out of pocket

I am a contractor and I need to refund a large amount over $20k to my customer for reimbursement of materials they purchased themselves on there credit cards.  Would I need to 1099 them? 

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TomD8
Level 15

Do I need to 1099 a large refund to a customer for materials they paid out of pocket

No, because the refund is not taxable income to your customer.  It is a return of their own money.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.

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1 Reply
TomD8
Level 15

Do I need to 1099 a large refund to a customer for materials they paid out of pocket

No, because the refund is not taxable income to your customer.  It is a return of their own money.

**Answers are correct to the best of my ability but do not constitute tax or legal advice.
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