I received a 1099 NEC but not self employed. What do I do?

[ELF159]

My disabled sibling lives with me  and I provide all living costs. A portion of his SSA retirement (not taxable to him) is forwarded to me and is used to provide housing, utilities, food, his phone bill (which I've had disconnected recently).  He is under the VA home based program and is pending VA A&A. I've received a 1099-NEC for the amount of the social security monies I received last year which is causing me to have to pay income tax and SE taxes on money I used for his support. What can I do to correct this?

[GeorgeM777]

Ordinarily, in situations of the type you describe, the beneficiary will receive a SSA-1099 reflecting the amount of benefits the beneficiary received during the year. What names are on the 1099-NEC that you received?  For example, is your sibling's name on the 1099-NEC?  How was the Recipient's name entered on the 1099-NEC?

@ELF159

[ELF159]

My siblings SSA statement/ funds goes to his son who is conservator and forwards a portion of the SSA funds to me as 'payment for care' but money is actually used for his benefit. My nephew sent the NEC (we were trying to make sure nothing interferes with any potential future medicaid needs and wanted clear documentation of where money was going)

[Vanessa A]

If you are not being paid to care for your brother, but this is just a way of transferring his money to spend on his care, you should not get a 1099-NEC. 

The 1099-NEC is for Non Employee Compensation which it doesn't sound like you are being compensated for anything instead it sounds like you are paying his bills with his money.  Listing the money as Payment for Care would be you being paid for his care.  If you are being paid to care for him, then you would report this as income.

If you are not being paid to care for him and you are simply the one who pays the bills out of your account similar to a roommate situation, then a roommate agreement or other similar document would document where his money went without giving you income.

Your nephew could file a correction of the 1099-NEC to cancel out your 1099-NEC.  

See section H on page 10 for information on correcting the NEC form. 

[leeloo]

In the event you are unable to get a corrected 1099, as a last resort you could expense the amount on Schedule C and list how the money was spent for his care.