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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Employment Law
Satisfied Customers: 110417
Experience:  20+ Years of Employment Law Experience
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1099 for discrimination settlement

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I had a discrimination settlement in 2012 against former employers. there was an agreement to pay settlement over a six month period, 3 months in 2012 and 3 payments in 2013. My lawyer turned out to be extremely unethical, but there was nothing I could do at that stage. She told me that she received 2 payments in 2012, and 4 payments in 2013. I never received any money from her until 4 months after the 1st. payment, when I was supposed to get them monthly. I have been trying to get my 1099 since January 2013, and I just received it today 7/22/2013. The 1099 shows the full amount as paid in 2012, although the agreement shows only 3 payments to be made in 2012. My lawyer says this is the way it is done. Is this true? I also filed my 2012 taxes with an estimate of 2 months payments because my lawyer told me that was all she got, but refused to give me any paperwork.

Thank you for your question. I look forward to working with you to provide you the information you are seeking.

If the settlement was awarded in 2012 and to be paid in payments, the 1099 should have been for each year when you received the payments. Thus, you should have received a 1099 for the 2012 payments and one for 2013 for payments made in 2013, since this money was evidently reimbursement for lost wages and as such the wage 1099 would be for the years in which you were paid. The way your attorney did this is the lazy way and it is not illegal for him/her to do it this way, but the proper way would have been to issue 2 1099 forms one for each year.

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Customer: replied 3 years ago.

Since my lawyer did not give me correct information as to the content of the 1099, and I filed my tax return for the two payments, how does that affect me? do I have for the entire amount although i did not receive it?

Thank you for your response.

You would have to file an amended return now he gave you the 1099 in this manner I am afraid. If you never received the money and it was supposed to be in payments, as I said the 1099 was not correct and if your attorney held the payments improperly from you, this is actually malpractice and you can file a complaint for malpractice with the state bar office of disciplinary counsel and also can sue the attorney for the costs you have incurred in having to make an amended tax return based on his/her improper filing of the 1099.
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