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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 28081
Experience:  Taxes, Immigration, Labor Relations
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1099 mi form JA: Thanks. Can you give me any more details

Customer Question

1099 mi form
JA: Thanks. Can you give me any more details about your issue?
Customer: Yes I revived a settlement in two parts 43602.00 one was taxed as wages other was for pain and suffering and punitive damages . I filed my taxes not putting second part of the pay , as my As
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Submitted: 6 months ago.
Category: Tax
Customer: replied 6 months ago.
So basically what happened is that I received a 1099 miscellaneous form. But what confuses me is half of the settlement was back wages and I received a W-2 form and I pay those taxes earlier this year and today I received this form but the amount is showinh full settlement .
Customer: replied 6 months ago.
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Expert:  Lev replied 6 months ago.
To determine if settlement amounts you receive by compromise or judgment must be included in your income, you must consider the item that the settlement replaces.Based on your information - the full amount of settlement is taxable and correctly reported.The amount reported as wages should be reported on line 7 form 1041 and additional amount is reported on line 21.In additional - you may deduct attorney fees and other legal expenses as these are related to taxable income. If you did not report a part of compensation - that is not correct - and you need to amend your tax return and correct that mistake.You may ONLY exclude from your income compensatory damages for personal physical injury or physical sickness (whether received in a lump sum or installments) - and that is not a a case based on your information.The part of settlement correctly reported on form 1099misc - but it looks as teh amount reported is not correct - in this case - you will need to communicate the sender and ask for correction. .
Customer: replied 6 months ago.
Okay so basically ask for a corrected 1099 form and if they don't correct it ? I am just so confused my full amount is on 1099 when the paid half on w2 and I paid that already .
Expert:  Lev replied 6 months ago.
Expert:  Lev replied 6 months ago.
Here are from IRS instructions...Form 1099-MISC incorrect? If this form is incorrect or has been issued in error, contact the payer. If you cannot get this form corrected, attach an explanation to your tax return and report your income correctly.So - you would not be able to get teh form corrected - you will need to report teh correct amount of income and attach a note with explanation of facts, reasoning and steps you done to correct the error...I appreciate if you take a moment to rate the answer.Experts are ONLY credited when answers are rated positively.If you still have any doubts, need clarification - please be sure to ask.I am here to help you with all tax related issues.

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