incorrect 1099

[kimlam]

I'm in California. I received a 1099 from my previous employer and the 1099 is incorrect. I have no idea how they came up with the amount I was 1099'd. While employed I was reimbursed for business expenses submitted via monthly expense report and I'm thinking since they recently terminated me they are now 1099ing me for the reimbursed expenses. I have sent a request for an accounting breakdown of the 1099 reported monies. What do I do if they do not respond or refuse to correct the 1099?

 

[CraigFL]

I'm not sure what your worry is. They are doing this to tell you how much THEY paid for those expenses. If you had expenses greater than that, you get to deduct the difference on your 1040.

 

[kimlam]

They have never 1099'd me for these expenses in the past 10 years. Now that I am no longer employed there I'm getting 1099'd. This was their way of paying me without putting it thru payroll so they could avoid payroll taxes.

 

[FlyingRon]

If you want to protest the characterization of you as a independent contractor as opposed to an employee, then you can file an SS-8 (there's also a similar California form, but the SS-8 will cover both fed and state) to get a determination.

However, presuming you really are a legitimate contractor, all the money they pay to you, be it your fee or expense reporting, should be reflected in the 1099 total. As pointed out, the expenses come right off the top on your 1040 Sched C before you add it as income on the main form.

If they paid your expenses directly to other parties (like they picked up the hotel room billing, etc...), then you shouldn't be 1099'd for that amount.