California Waiting Time Penalty - How to file if issued wrong Tax Form?

[darren_lee14]

Hello,
I received payment for California Waiting time penalties and was issued a 1099-NEC from my former employer. I understand I should have been issued a 1099-MISC with it captured on box 3 - other income. From what I've read and it clearly states in the filing instructions, 1099-NEC is for non employee compensation in regards to services rendered. So I know I am correct that they issued the wrong form. What can I do if my employer refuses to correct the tax form? Can I still file my taxes even though the 1099 is wrong?

[Cynthiad66 · Accepted solution]

Yes you can file and report the income as "Other Income".  Follow step to report as other income:

You would enter that Form 1099-NEC as a Form 1099-MISC as OTHER INCOME using the directions in the FAQ below since it was not self-employment income:

You can report it as other income on Form 1040.. Here's how to enter it in TurboTax.

• Click the Federal Taxes tab
• Click Wages & Income
• On the screen "Your 2021 Income Summary," scroll all the way down to the last section, "Less Common Income."
• Click the Start or Update button for the last topic, "Miscellaneous Income, 1099-A, 1099-C."
• On the next screen, "Let's Work on Any Miscellaneous Income," scroll down and click the Start or Update button for the last topic, "Other reportable income."
• The next screen asks, "Did you receive any other taxable income." Click Yes.
• On the next screen, "Other Taxable Income," enter a description and the amount. Click Continue.
• On the next screen click Done.

It is important that you report the amount received.  IRS will be able to see that the amount on the Form 1099-NEC is actually reported as Other Income.

California law requires employers to pay wages immediately to employees who get terminated or who resign with 72-hours notice. Otherwise, employers are liable to pay a waiting time penalty equal to the worker’s daily rate of pay for each day late, up to 30 days.