The correct report date to IRS for a payment

[mahdi]

What is the name of your state? NY

I have received a payment in mid-Jan. 2020 for the work that I am doing from Jan-1 to July-30 2020. However, my employer has reported it to IRS as a 2019 payment, thus pushing me to a higher tax bracket and increasing my tax liability significantly. They are currently refusing to correct this, since they consider this a standard procedure and the payment was in fact processed in Dec 2019 in their system. So I am wondering whether there is a legal basis for me to challenge their decision.

 

[PayrollHRGuy]

What is the name of your state? NY

I have received a payment in mid-Jan. 2020 for the work that I am doing from Jan-1 to July-30 2020. However, my employer has reported it to IRS as a 2019 payment, thus pushing me to a higher tax bracket and increasing my tax liability significantly. They are currently refusing to correct this, since they consider this a standard procedure and the payment was in fact processed in Dec 2019 in their system. So I am wondering whether there is a legal basis for me to challenge their decision.

How are they reporting this? W2, 1099? In both cases that would have been reported back in January.

 

[Zigner]

What is the name of your state? NY

I have received a payment in mid-Jan. 2020 for the work that I am doing from Jan-1 to July-30 2020. However, my employer has reported it to IRS as a 2019 payment, thus pushing me to a higher tax bracket and increasing my tax liability significantly. They are currently refusing to correct this, since they consider this a standard procedure and the payment was in fact processed in Dec 2019 in their system. So I am wondering whether there is a legal basis for me to challenge their decision.

You don't report it as 2019 income.

 

[mahdi]

They are reporting it via 1042-S. It is basically a fellowship payment.

Then how can I force my employer to send a correction to IRS?

 

[adjusterjack]

I have received a payment in mid-Jan. 2020

How did you receive it? By check? What was date on the check? Did you keep a copy? Did the check stub explain what it was for?

If you have enough documentation that it was 2020 earnings you won't have to add it to your 2019 taxes.

 

[Taxing Matters]

What is the name of your state? NY

I have received a payment in mid-Jan. 2020 for the work that I am doing from Jan-1 to July-30 2020. However, my employer has reported it to IRS as a 2019 payment, thus pushing me to a higher tax bracket and increasing my tax liability significantly. They are currently refusing to correct this, since they consider this a standard procedure and the payment was in fact processed in Dec 2019 in their system. So I am wondering whether there is a legal basis for me to challenge their decision.

If the company initiated payment in their system in December 2019, why did you not get it until "mid-Jan. 2020"? Was there any option for you to get that payment from the company sooner, i.e in 2019? For example, were you notified you could have picked up the payment in December but elected to have it mailed to you?

 

[Taxing Matters]

Then how can I force my employer to send a correction to IRS?

You cannot force the company to send a correction. But if the income is properly accounted for by you in 2020 then that is how you report it on your returns. The reason I asked the question I did in my earlier reply is help figure out when you have to take the payment into income.

 

[mahdi]

It was a direct deposit. I had no influence on the processing time, nor I had the option to receive it earlier.

On the bank statement the deposit is made on Jan 16 with this description "Cornell Universi NBS refund".

 

[PayrollHRGuy]

It was a direct deposit. I had no influence on the processing time, nor I had the option to receive it earlier.

On the bank statement the deposit is made on Jan 16 with this description "Cornell Universi NBS refund".

It is strange they would tag a payment for work as a refund.

 

[mahdi]

It is strange they would tag a payment for work as a refund.

True. That might be because they are receiving the fund from another source...

So in conclusion, I will file my 2019 tax return neglecting this payment. Then I will include it next year when filing my 2020 tax return (despite the fact that on top of 1042-S form it says 2019).

 

[Taxing Matters]

True. That might be because they are receiving the fund from another source...

So in conclusion, I will file my 2019 tax return neglecting this payment. Then I will include it next year when filing my 2020 tax return (despite the fact that on top of 1042-S form it says 2019).

And keep a copy of the Form 1042-S, the bank statement that shows the corresponding deposit, and your 2020 return so you can provide copies of all that that along with a letter of explanation to the IRS when its computer spits out a letter to you asking why that amount was not reported on your 2019 return.

 

[mahdi]

And keep a copy of the Form 1042-S, the bank statement that shows the corresponding deposit, and your 2020 return so you can provide copies of all that that along with a letter of explanation to the IRS when its computer spits out a letter to you asking why that amount was not reported on your 2019 return.

That's very helpful. Thank you everyone for the prompt response.