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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
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Experience:  10 years experience
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My friend stole money from her employer past 5 years, she

Customer Question

My friend stole money from her employer for the past 5 years , she came clean with him and paid him back the full amount this year . He is going to put it on a 1099 . Is this correct even though she has given all the money back ?
Submitted: 1 year ago.
Category: Tax
Expert:  emc011075 replied 1 year ago.

Hi. My name is ***** ***** I will be happy to help you.

Stolen money is taxable for tax purpose and the employer can issue 1099 for it even if the money was repaid. Your friend will have to claim it as income and than deduct the repaid amount on schedule A, subject to limitations. There's usually no deduction on state return.