March 11th 2013
Filing tax returns can be costly and time consuming. And with companies increasing reluctant to hire full-time employees, more taxpayers are having problems figuring what to do with those pesky 1099s on their annual returns. While filing a tax return with W-2 is fairly straightforward. 1099s are a catchall form that is used to account for many different kinds of income and can be tricky. 1099s may be issued for Schedule Cs, Schedule Es, and for many other types of income. One of the main problems with 1099s is accuracy. Many times 1099s are issued that are simply not accurate.
Here are a couple of things you can do to make sure the information submitted on your tax return is accurate — even 1099s aren’t.
1) Contact the issuer of the 1099 and ask for amended 1099s to be sent;
2) Provide an explanation to the IRS and other tax authorities explaining why the 1099 is not accurate; and
3) If you’ve submitted an inaccurate return because of the 1099, fix the mistake and amend the return.