1099-NEC I had to repeatedly request doesn't match my income records - what now?

This is actually a pretty common issue with 1099-NECs, so try not to panic. What's important is that you have your own detailed records, which it sounds like you do. You have a few options here. First, I'd recommend reaching out to the company one more time, but in writing (email) so you have documentation. Explain the discrepancy clearly with exact amounts and ask them to issue a corrected 1099-NEC. Include copies of your invoices and payment records if possible. If they refuse to correct it, you'll need to report the situation on your tax return. You should report the full amount shown on the 1099-NEC on Schedule C (since the IRS received this information), but then deduct the difference as "returns and allowances" on line 2 of Schedule C. This way, you're only paying taxes on the income you actually received. Also, keep detailed documentation of all your attempts to resolve this with the payer, as well as your bank statements and invoices showing the actual payments received. If the IRS questions the discrepancy, you'll need this documentation to support your position.

I went through almost the identical situation last tax season! My client reported about $4k more than they actually paid me. After weeks of getting nowhere with their accounting department, I was about to give up. Then I tried using taxr.ai (https://taxr.ai) to analyze all my invoice documents and payment records. Their system actually created a complete reconciliation report showing the discrepancy between what I was paid vs what was reported on the 1099-NEC. The detailed analysis helped me prove my case to both the client and the IRS. Having a third-party verification of my income records made all the difference - the company finally issued a corrected 1099-NEC. It saved me from having to file with inconsistent numbers and potentially triggered an audit.

Just wanted to update - I decided to try taxr.ai after my last comment and WOW it was exactly what I needed! I uploaded my jumbled mess of tax docs from the past 3 years and it organized everything beautifully. The mortgage broker was super impressed with the income verification report it generated. He said it was much more comprehensive than what most applicants provide and it definitely sped up my application process. For anyone in a similar situation with document organization issues, especially when you need to prove your income history, I'd definitely recommend checking it out!

Look, I know this doesn't solve your immediate 1099 problem, but for future reference - I had HORRIBLE luck getting through to the IRS about a similar issue last year. Called literally 17 times and either got disconnected or waited for hours. Finally found this service called Claimyr (https://claimyr.com) that somehow got me connected to an actual IRS agent in under 20 minutes! You can see how it works here: https://youtu.be/_kiP6q8DX5c The agent helped me understand exactly how to document and report the discrepancy. Turns out you can also request the IRS to contact the company that issued the incorrect form if they refuse to correct it themselves. Saved me so much stress once I actually got to speak to someone!

Well I'll be damned. After my skeptical comment, I figured I'd try Claimyr just to prove it wouldn't work. I've been trying for TWO WEEKS to reach someone at the IRS about a tax notice I received. Got a call back in 27 minutes (not quite the under 20 advertised but still amazing). Talked to an actual human being who helped clear up my tax notice issue AND I asked about the 1099-NEC discrepancy situation like OP described. The agent explained exactly what forms to file and offered to send me the relevant documentation. I'm still a bit shocked this actually worked after all my failed attempts to contact them directly.

I had this same issue last year. The company that paid me lumped in some expense reimbursements with my contractor payments and reported the total on the 1099-NEC. Could that be what happened in your case? Check if any of their payments to you included reimbursements for materials, travel, or other expenses. Those shouldn't be reported as income on a 1099-NEC if they were true reimbursements.

Has anyone else noticed that this seems to be happening more often lately? I'm a freelance developer and THREE of my clients messed up my 1099s this year. One was off by almost $8k. I'm wondering if there's some new accounting software that's causing these errors.

This is such a frustrating situation but you're definitely not alone! The expense reimbursement issue that StarGazer101 mentioned is probably exactly what happened. I've seen this mistake so many times - companies treat reimbursements as contractor payments in their accounting systems. Here's what I'd suggest for your next steps: 1. Send them a formal email (not just a phone call) listing out each expense reimbursement separately from your actual service payments. Be very specific about dates and amounts. 2. Reference IRS guidelines that expense reimbursements under an accountable plan should NOT be included in Box 1 of a 1099-NEC. 3. Give them a reasonable deadline (like 10 business days) to issue a corrected 1099-NEC. 4. If they refuse, you're not stuck! You can still file correctly by reporting the full 1099 amount on Schedule C line 1, then deducting those same reimbursed expenses on the appropriate expense lines of Schedule C. The key is keeping meticulous records of everything - your original invoices showing the separation between fees and reimbursements, receipts for the expenses, and all your correspondence with the company. Don't let this stress you out too much. The IRS deals with 1099 discrepancies all the time, and as long as you have good documentation, you'll be fine!