Yes, you are responsible for the income tax on that income. You are also responsible for the employee half of FICA (social security & medicare) tax.
Whether you get a 1099 or not, you should report the income. Actually getting the 1099-Misc works to your benefit, as it documents that you were paid. There is a way to essentially report a 1099 like a W-2. See below. Without a 1099, you use your own records to report the income.
You cannot use the unpaid wages to pay taxes. As far as the IRS is concerned, those wages don't exist. That's a legal matter or a separate matter for the state employment commission.
_________________________________________________________________________________________________________
It is not "illegal" for an employer to 1099 you.
But, there is a way to contest the
“employer’s” classification of you as a contract employee. That is to pay your
share of the Social security tax on form 8919 .In TurboTax, type> form
8919 with 1099-misc income <in the search box. After you enter your 1099-Misc, select that
you got the 1099-Misc for another reason. Then select "My employer reported
this extra money on a 1099-MISC but it should have been reported on a W-2"
from the drop down list.
You also have to submit form SS-8 and the IRS will determine whether you or
the employer pays the employer portion of the SS tax. You will probably also
upset your employer, because the IRS may contact him about whether or not he
properly paid wages.
Form SS-8 is not in TT but is here ===>>> http://www.irs.gov/pub/irs-pdf/fss8.pdf
See this IRS site ===>>> http://www.irs.gov/taxtopics/tc762.html
_______________________________________________________________________________________________________
Assuminhg you get neither a W-2 or 1099-Misc:
If you haven’t received your
W-2, follow these four steps:
1. Contact your employer If you have not received your W-2, contact your
employer to inquire if and when the W-2 was mailed. If it was mailed, it may
have been returned to the employer because of an incorrect or incomplete
address. After contacting the employer, allow a reasonable amount of time for
them to resend or to issue the W-2.
2. Contact the IRS If you do not receive your W-2 by February 15th, contact the
IRS for assistance at 800-829-1040. When you call, you must provide your name,
address, city and state, including zip code, Social Security number, phone
number and have the following information:
• Employer’s name, address, city and state, including zip code and phone number
• Dates of employment
• An estimate of the wages you earned, the federal income tax withheld, and
when you worked for that employer during 2014. The estimate should be based on
year-to-date information from your final pay stub or leave-and-earnings
statement, if possible.
3. File your return You still must file your tax return or request an extension
to file April 15, 2017, even if you do not receive your Form W-2. If you have
not received your Form W-2 by the due date, and have completed steps 1 and 2,
you may use Form 4852, Substitute for Form W-2, Wage and Tax Statement. Attach
Form 4852 to the return, estimating income and withholding taxes as accurately
as possible. There may be a delay in any refund due while the information is
verified.
4. File a Form 1040X if you later receive your missing W-2 after you filed your
return using Form 4852, and the information may be different from what you
reported on your return. If this happens, you must amend your return by filing
a Form 1040X, Amended U.S. Individual Income Tax Return
Reference:
https://www.irs.gov/uac/missing-form-w2-irs-can-help
