1099 NEC company won’t correct

[asmalltimeco]

Hi. We did some trucking for company “A” that pays out every 45 days. To avoid waiting the 45 day period for payment, we use a factoring company that pays the us next day for a small percentage, then they recoup the payment from company “A”. Company “A”  sent a 1099NEC only for the amount paid by check directly to our business. They will not correct their 1099 NEC to show the additional amount they paid  to reimburse the factoring company. The factoring company does not issue a 1099 and says all payments should show on company “A’s”1099 NEC.  The difference is over 20K. Should we enter the amount from company “A’s” 1099, then the rest in other self employed income?  Or, enter the amount that matches our total charges, not what company “A” reported into the 1099 data with a note? Or…something else?

[AliciaP1]

You should use the amount on the 1099-NEC you received.  When you use a factoring company, you are not selling your receivables, merely taking an advance on them.  If the company does not pay the factoring company for some reason, you will be charged back the amount so have not truly received the income.