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Marflore
Level 1

I received 1099 and k1 from the same company. Is this ok?

I was hired by a company for a couple of years as an independent contractor and received 1099 from the company. Around May of 2017, I bought the company so the company issued me k1. Basically, I received 1099 for the income I received before I bought the business and then received K1 after I took over the business. Would this be an issue with IRS? How an I explain this in TurboTax? 

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CathiM
New Member

I received 1099 and k1 from the same company. Is this ok?

This should not be an issue for the IRS.  Although business owners should not issue themselves 1099s (while they are owners), this shouldn't cause any problems with your return being e-filed or accepted by the IRS. Just keep your documentation to show the IRS if they ever question it. You have done things correctly, no need to be concerned.  I have seen business owners erroneously issue themselves a 1099-MISC and the IRS did not reject it or question it.  There is nowhere to notate this on your tax return and trying to add an explanation somewhere could cause the return to reject. 

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1 Reply
CathiM
New Member

I received 1099 and k1 from the same company. Is this ok?

This should not be an issue for the IRS.  Although business owners should not issue themselves 1099s (while they are owners), this shouldn't cause any problems with your return being e-filed or accepted by the IRS. Just keep your documentation to show the IRS if they ever question it. You have done things correctly, no need to be concerned.  I have seen business owners erroneously issue themselves a 1099-MISC and the IRS did not reject it or question it.  There is nowhere to notate this on your tax return and trying to add an explanation somewhere could cause the return to reject. 

View solution in original post

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