How to File a Corrected 1099

where to report 1099 b

If you send an incorrect 1099 to either the taxpayer or a taxing authority, you need to issue a corrected one to the state government, the federal government and the 1099 payee. The IRS General Instructions for Informational Returns provide specific directions for amending informational returns. For certain types of errors, you must fill out a new 1099 and resubmit it. For other errors, you only need to correct the payee, payer and account information.

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Error Type 1

How you deal with an incorrect return depends on the type of mistake you made. These mistakes are considered Error Type 1:

  • You listed an incorrect amount of money. wrote in the wrong code. missed a checkbox or marked the wrong checkbox on the original 1099-MISC.
  • You filed a return when you should not have filed one.

If your mistake matches up with Error Type 1, you must:

  1. Prepare a new Form 1099 with the accurate information for the payee. Fill in all fields, not just the ones you need to correct.
  • Put an "X" in the Corrected box at the top of the 1099 form.
  • Send Copy A, along with Form 1096, to the IRS. If you haven't already sent the erroneous copy to the IRS, do not include this copy with

    the Form 1096.

  • Send Copy 1 to the appropriate state tax agency.
  • Send Copy B with the corrected information to the recipient.
  • Error Type 2

    Error Type 2's require a different process for correction than Error Type 1. Error Type 2's happen when:

    • You failed to list the payee tax ID number or the number was incorrect.
  • You listed the payee's name incorrectly.
  • You filed the wrong form - for example a 1099-INT instead of a 1099-MISC - for the return.
  • For Error Type 2, you must:

    1. Prepare a new 1099 on the correct form and put an "X" in the Corrected box.
  • Enter the information for the payer, payee and account information as it appeared on the incorrect return. For all monetary amounts, enter "0."
  • Prepare a new 1099 on the correct form and do not put an "X" in the Corrected box.
  • Fill out the 1099 with the correct information.
  • Send Copy A, along with Form 1096, to the IRS. If you haven't already sent the erroneous copy to the IRS, do not include this copy with the Form 1096.
  • Send Copy 1 to the appropriate state tax agency.
  • Send Copy B with the corrected information to the recipient.
  • Source: ehow.com

    Category: Bank

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