1099Misc. Income apply then deduct question?

Eileen1 · ‎June 1, 2019

Hi there, I have received a 1099misc for commissions. I Reported this on my income, however I now need deduct the same income, because I paid it back to my employer.

This income was never really my income. How to I reverse the same income to zero?

Thank you!

MichaelMc · ‎June 1, 2019

I would suggest filing a Schedule C-EZ, reporting the Form 1099-MISC income and showing a single line item expense for the repayment to the employer.

Since the IRS performs a matching of Forms 1099-MISC to the Copy A filed by the issuer, there is no way to avoid reporting it, and simply expensing the repayment. Failure to report will most certainly invite a letter from the IRS several months from now, followed by time and effort on your part to explain the situation.

View solution in original post

MichaelMc · ‎June 1, 2019

I would suggest filing a Schedule C-EZ, reporting the Form 1099-MISC income and showing a single line item expense for the repayment to the employer.

Since the IRS performs a matching of Forms 1099-MISC to the Copy A filed by the issuer, there is no way to avoid reporting it, and simply expensing the repayment. Failure to report will most certainly invite a letter from the IRS several months from now, followed by time and effort on your part to explain the situation.