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New Member
posted Apr 10, 2023 9:25:10 AM

I am a salaried W2 employee, my employer gave me both a W-2 as well as a 1099-NEC for commissions earned

Why would an employer issue a 1099-NEC if I earned these commissions as a full-time salaried employee?

0 4 1502
4 Replies
New Member
Apr 10, 2023 9:28:56 AM

My best guess is that your salary income and your tip income are treated separately from a tax standpoint, therefore you need them reported separately and on the proper form.

Hope this helps!

Expert Alumni
Apr 10, 2023 9:47:11 AM

Your employer should not have given your a 1099-NEC. A 1099-NEC is for Non Employee Compensation.  All wages from your employer including commissions should be reported on a W-2.  They are not taxed or treated any differently.  You need to contact your employer and ask for a corrected W-2 that includes the commissions and for them to retract the 1099-NEC with the IRS. 

 

If your employer will not issues the correct W-2 you can follow the steps here to get a corrected form or file a return with correct information. 

 

Since it is late in tax season, you will need to file form 4582 which means you will need to print and mail your return.  Overall, it is best to get your employer to fix their mistake. 

New Member
Apr 10, 2023 9:54:30 AM

Vanessa, Thank you for the reply.  My boss is out of the country and is not a reasonable person who would more than likely not be willing to make the change.  Are there any other tax codes that would apply to the need for 1009-NEC for commissions?

Expert Alumni
Apr 10, 2023 10:23:26 AM

The 1099-NEC is used for Non Employees.  That is in the title of the form. If you are an employee, you should not get a 1099-NEC. Your boss is responsible for one half of your social security and medicare taxes on your wages. When he puts your commissions on the 1099-NEC, he is trying to avoid his half of the taxes.  Not paying it, leaves him subject to penalties and interest.  Misclassifying your income as self-employment income does not changes his responsibility.