Sole Proprietor issued 1099 instead of W2 to employee. Can I fix it?

Forum|Forum|7 years ago
June 6, 2019
1 reply
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I have a Sole Proprietorship business, and hired my minor child as a part time employee. He works for me exclusively and consistently throughout the year. I accidentally filled out a 1099 MISC for him this year (and submitted it before the 1/31/18 deadline, so the IRS has it), but I realize I should have given him a W2. Neither of us have filed our returns.

Can I issue him a W2 now instead?

If yes, do I need to somehow let the IRS know to ignore the 1099 MISC that I already mailed in to the IRS?

Thank you!

TurboTax Premier Windows

Best answer by KittyM

Yes, you can fix it. First, you need to issue a "Corrected" 1099-MISC to your child and mail a copy to the IRS. The corrected 1099-MISC will have the checkbox for corrected marked and show a zero amount where you showed income previously.

Then you will complete a W-2 for your child, showing their wages and withholding for the year. Please make sure that the information matches what you reported as wages and withholding on your Form 941 for 2017: Employer's QUARTERLY Federal Tax Return, or you will get a matching notice from the IRS and/or Social Security.

K

KittyMAnswer

Employee

Yes, you can fix it. First, you need to issue a "Corrected" 1099-MISC to your child and mail a copy to the IRS. The corrected 1099-MISC will have the checkbox for corrected marked and show a zero amount where you showed income previously.

Then you will complete a W-2 for your child, showing their wages and withholding for the year. Please make sure that the information matches what you reported as wages and withholding on your Form 941 for 2017: Employer's QUARTERLY Federal Tax Return, or you will get a matching notice from the IRS and/or Social Security.