1099-misc wrong box filled in income vs lawyer fees

[JMcCanna]

Hi,

I am an attorney and received a 1099-Misc for a claim settlement. The filer put in the settlement amount in box 7 when it should have been box 14.

I want to make sure the IRS knows it was not all income.

Thoughts?

[maglib]

@JMcCanna

If you received an erroneous 1099-Misc: Foremost request a new 1099 but, still you may not get it.

Attach a copy of the 1099 and a statement explaining the circumstances. You can't e-file.  IRS instructions for form 1099-Misc:  "If this form is incorrect or has been issued in error, contact the payer. If you cannot get this form corrected, attach an explanation to your tax return and report your income correctly."

OR

Report the 1099-misc amount on schedule C and take a deduction, for the difference in the actual amount You report the entire amount as income and then deduct your expenses, on the the appropriate line(s), on Schedule C.

OR hope they will send an edited 1099 and just report it as an amended 1099 and hope they do it soon and report it how it should have been sent.  So just report it how it was supposed to be reported and hope the payer files an amended 1099-Misc

Gross proceeds paid to attorneys.https://www.irs.gov/instructions/i1099msc#idm140364727241152

For more examples and exceptions relating to payments to attorneys, see Regulations section 1.6045-5.

However, these rules do not apply to wages paid to attorneys that are reportable on Form W-2 or to profits distributed by a partnership to its partners that are
reportable on:

• Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc.

 Gross Proceeds Paid to an Attorney

Enter gross proceeds of $600 or more paid to an attorney in connection with legal services (regardless of whether the services are performed for the payer).

Hope this helped