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MaryTL
Level 2

1099 MISC issued to renter instead of the business owner, now I am being forced to pay their taxes.

Hello Turbo Tax Community,

 

I am searching for an answer regarding a 1099 MISC and Schedule E.

 

Please allow me to provide a description of the situation.

 

My parents home was destroyed during Hurricane Michael and I had to rent a home for them while repairs are made.

 

The “temporary housing agency” which was brought in by the insurance company required that I complete a W-9 instead of the business that owns the property that we are renting.

 

Moreover, they insisted that I receive the rental payments and forward them directly to the owner/landlord, which I did.

 

I now know that I should not have been asked to complete the W-9 but at the time I had no idea what I was being asked to do in the midst of trying to get my parents settled.

 

Because of this W-9 I received a 1099-MISC which states that I (the renter) made $4200 in rent, which I did not.

 

I contacted the temporary housing agency and asked if they could correct this matter, retract the W-9 and issue it to the company who owns the home.

 

The temporary housing agent stated that they would not correct the form that that I should “ complete a Schedule E and somehow reverse the income as a loss”.

 

I am at a complete loss as what to do, I have reviewed the Schedule E and it frightens me terribly.

 

I would be required to state that I own the rental home among a litany of other questions pertaining to fair market rent, carry overs, and rental types. All questions that I have no answer to.

 

I fear that if I proceed to file my taxes with a Schedule E I will be audited.

 

Can anyone advise if the temporary agency should correct the W-9?

 

If the answer is no, should I file a Schedule E and how would I reverse this income as a loss.

 

Thank you all for your time and assistance.

 

 

2 Best answer

Accepted Solutions
PaulaM
Expert Alumni

1099 MISC issued to renter instead of the business owner, now I am being forced to pay their taxes.

Report it as Misc Income in the Less Common Income section for the $4,200. Then make a second entry in the same section for a -$4,200. That way you are disclosing to the IRS the form 1099-MISC, but the net effect will be zero for you. Keep good records of the events you described.

 

 

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MaryTL
Level 2

1099 MISC issued to renter instead of the business owner, now I am being forced to pay their taxes.

Thank you Paula! I will follow your instructions.

 

View solution in original post

3 Replies
PaulaM
Expert Alumni

1099 MISC issued to renter instead of the business owner, now I am being forced to pay their taxes.

Report it as Misc Income in the Less Common Income section for the $4,200. Then make a second entry in the same section for a -$4,200. That way you are disclosing to the IRS the form 1099-MISC, but the net effect will be zero for you. Keep good records of the events you described.

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
MaryTL
Level 2

1099 MISC issued to renter instead of the business owner, now I am being forced to pay their taxes.

Thank you Paula! I will follow your instructions.

 

PaulaM
Expert Alumni

1099 MISC issued to renter instead of the business owner, now I am being forced to pay their taxes.

You are welcome! 🙂

 

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