Richard A. Lindsey, CPA

Lindsey & Waldo, LLC – Certified Public Accountants

  • Feb 5

    Have you ever thought: “What should I do if my 1099 is wrong?” Well, here are four steps to take if you are issued an incorrect Form 1099.

    1. Contact the issuer as soon as possible. Once you contact the issuer, explain to them that the 1099 was issued for the wrong amount. You should be able to prove to the issuer the correct amount that should have been reported. Then, ask the issuer to reissue the 1099 with the correct amount. Hopefully you can catch the issuer before they file the 1099s with the IRS. If so, the issuer can easily reissue the 1099 with no problem.
    2. Another great item to get as proof is a letter from the issuing company that states the original 1099 was issued in error, the original 1099 has been destroyed, and a new, corrected 1099, in the stated corrected amount, has been issued. This letter of proof could come in handy if the company did not take the proper steps in correcting the 1099 with the IRS.
    3. If the company has already issued your 1099 and sent it to the IRS, the company will need to issue a “corrected” 1099. The box on the top of the 1099 should be marked as “corrected.” If the original 1099 was previously sent to the IRS, make sure the “corrected” box is checked on your new 1099. If it is not marked “corrected,” the IRS will think you were issued two 1099s from the same company and add them together.
    4. What happens if the company will not correct the original erroneous 1099? You will need to address this on your return. You will need to report the amount reported on the 1099 you received on your return, and then explain the overstatement of the 1099 in a footnote or statement.

    Most importantly always pay attention when you receive a 1099 to make sure you were issued a correct 1099. It is easier to address the issue of an erroneous 1099 earlier than later.