Question

Didn't issue a 1099

Forum|Forum|6 years ago
March 26, 2020
1 reply
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So I didn't issue a 1099 to a contractor. He didn't break down the labor and materials for me. The amount is $705. Turbotax asked me if I failed to send out. I answer yes. I am wondering how this is handled. Will the IRS be notified of my mistake to trigger a possible audit or am I just penalized a $100 or what? I believe I can still claim it. In my research I find that it is commonly thought that I can't deduct it and this is not true as nothing stated in Section 162 or Cohan requires a Form 1099 to be issued for a subcontractor labor expense to be deducted. I just have to prove the expense if audited.

TurboTax Self Employed Online

AmyC

Employee

On your business forms, it has a place to mark that you failed to send the form. You can still send it. Late would be better than never. See how to to file a 1099-MISC here. with us.

Yes, you can still deduct the expenses with your proof of payment for audit backup.

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M

MG26Author

I can't find the place where it asks me if I need to issue a 1099 and whether I did. I need to change the answer now that I found the itemized labor/material invoice. The question is not there anymore. Please tell me the navigation.