Missing Form -1099

[Anonymous]

I earned $1,000 from Rover (the dog walking service) in 2019, but I did not get a Form-1099-Misc from them.  When I reached out to them, they told me "I will not be receiving a Form 1099 for 2019 because I did not withdraw over $600 via check during 2019".  They even have this as an explanation on their website.

They are correct, I did not withdraw the money in 2019.  I do plan to withdraw it in 2020.  However, the IRC applies the concept of constructive receipt to cash basis taxpayers, which means I must report the $1,000 as income in 2019 since that is when I earned it.  This is what I plan to do.

If I report the income in 2019, and Rover reports it 2020, the IRS will see there is a mismatch in reporting both in 2019 and 2020.  I am concerned this will create a problem for me when I file my 2020 taxes, since the IRS will get a 2020 Form 1099-Misc from Rover reporting $1,000 of income, but I will not be reporting any income in 2020 because I reported it in 2019.

Do you have any suggestions on when I should actually report this income (2019 or 2020)?  If your answer is 2019, then how do I handle the 2020 mismatch?

Also, is Rover correct in telling me they do not need to issue a 2019 Form 1099-Misc to me because I did not withdraw over $600 via check in 2019, even though I earned it in 2019?

[DavidD66 · Accepted solution]

Since Rover didn't make a cash payment to you of $600 or more they are not required to send you a Form 1099-MISC.  If you had the ability to "withdraw" the funds from Rover in 2019 it would be income in 2019.  That said, given the amount and the fact that you didn't receive a Form 1099-MISC, I think you would be fine waiting until 2020 to report it if that's how you want to handle it.  If you report as income in 2019 and then receive a 1099-MISC for it in 2020, you can enter a Misc expense on your Schedule C for the same amount, and that will offset the revenue.

[Anonymous]

Thanks David.  That's a good answer.

But, I have to say, I am surprised that Rover doesn't have to report the payment until it becomes a "cash payment".

I never heard of such a thing, and I can't find support for that in any IRS documents.

[VictoriaD75]

It is not so much about the form of payment as it is the dollar threshold. They do not have to issue you a document until they have paid $600 or more. That does not preclude you from reporting the income. You must report income from all sources derived regardless of amount.

Form 1099-MISC

[Anonymous]

Thanks Victoria,

I'm afraid you missed the point of the discussion I was having with David.  I am aware of the $600 threshold.

Please look back at the thread between David and me, or perhaps you can ask him to respond.

Thanks

Steve

[ColeenD3]

They may be under the mistaken idea that if you haven't withdrawn the money, they have not paid it. They may be accrual method instead of cash method. However, if you have access to the funds at any given time, you have constructive receipt of the funds.

Bottom line is, it doesn't matter to you why they do this since you have the solution via David. This happens occasionally.