Incorrect 1099

[timwhite]

I received a 1099 from a contract client that overstated what they paid me for services. I asked for a correction, they agreed to correct and yet 6 months later despite repeated requests I have not received corrected amount. How do I correct/file/report  the correct 1099 income?

[xmasbaby0]

The IRS expects your reported income to match the 1099 that was sent in by the business or client who issued it.  Your problem is with the issuer of the 1099.   If you try to change it and report a different amount, you are going to get a nasty letter from the IRS someday.  Double up on your efforts to get a corrected 1099 from them.

[Tanisha EA]

Sorry to hear that you are going through this.  It does sound like they have paid you but that the amount is not correct.  I would enter the 1099-NEC.  I would then backout the amount you do not agree with as an other miscellaneous expense.  I would request documentation from the company that issued the 1099-NEC that will support what you have done on your tax return.  I would maintain good records to support this adjustment.  

You can also contact the IRS for help but this may take longer with the filing deadline approaching.

https://www.irs.gov/newsroom/what-to-do-when-a-w-2-or-form-1099-is-missing-or-incorrect

[marctu · Accepted solution]

@timwhite thank you for the question, and I am sorry that this is happening to you.  

There’s no good answer to this, though  you will need to address this on your return. For example, you should show the incorrect payment on your return on Schedule C or on Schedule 1.  On Schedule C you could enter an expense for the overpayment with an explanation.  This would best be done in Miscellaneous Exegeses.  On Schedule 1, you would go to Other Common Income.   There you would do this: (Just an Example)

1099-MISC  Incorrect (Payor and EIN) $ Full Amount

1099-MISC Corrected Amount (Payor and EIN) $ Enter as a Negative Number (The full amount less this amount equals the correct amount. 

These situation all have the potential for higher audit risk, though you probably don’t have much choice. I would say contact a lawyer if you are really miffed, but that comes with a cost as well.   

All the best,

Marc T.

TurboTax Live Select Time Tax Expert

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