Form 1099 is one of the IRS forms that are used by the tax filers to report any specific types of payments. It contains a series of the informational returns identified by a letter, consists of the forms ranging from Form 1099-A to Form 1099-SA. Business owners use the IRS 1099-MISC Form in order to report the money paid to the independent contractors.
Form 1099-MISC contains the information about the business and the independent contractor you paid. When you find any error in the given information, you can take a 1099 correction. Revised forms need to be submitted to the IRS, state agencies and the independent contractor.
How to correct Form 1099-MISC?
In order to correct a Form 1099-MISC after filing, the first step you need to do is identify the type of the error whether Type 1 or Type 2:
- The Type 1 error includes the incorrect tax amount, name of the payee or code.
- The Type 2 error includes the missing or incorrect tax filer’s identification number or an invalid contact address added.
Follow the below steps to correct the incorrect information in the Form 1099-MISC.
- The initial step is to find the type of the error and refine it.
- Compare with the original 1099-MISC form while preparing for the correction. The information needs to be provided in such a way as it was entered in the original form earlier.
- Get another Form 1099-MISC from the IRS, here you cannot use the online version as it is not accepted by the IRS.
- In addition to that form, get another Form 1096 from the IRS and use it as a cover sheet by summing up the 1099 information. Whenever you correct a 1099-MISC form, you need to attach a 1096 Form, in short for each 1099 form correction you need a 1096 form.
- After entering the correct information on the Form 1099-MISC ensure to check the “corrected” checkbox, which is at the top of the Form. So that you are reporting the IRS that this Form is earlier filed.
- While you are correcting the Type 1 error, give the corrected information then add the rest of the information exactly what you reported originally.
- Type 2 errors are used to correct the incorrect information; here you cannot correct the dollar amounts. Enter the information to correct for a Type 2 error, but dollar amounts entered in this corrected form should contain only zero.
- Ensure to complete the Form 1096 with proper information and no errors.
- After ensuring the correctness of the information filled, send the copy of the mail to the independent contractor, to the IRS (check the address in the instructions section of the form) and required state tax departments.
The IRS forms can be ordered for FREE from the IRS website. Check the IRS website for further 1099 instructions. Hope this article gave wide information about how to correct the Form 1099-MISC. Still, if you have any queries to answer and for more assistance, contact our customer support team at 703-229-0326 or drop a mail at firstname.lastname@example.org. We are happy to assist you at any time.