Help dealing with incorrect 1099 form showing higher payment amount than received

You're on the right track with your research. When you receive an incorrect 1099 form, you do have options even if the company doesn't send a corrected version in time. The method you found is exactly what many tax professionals recommend: report the full amount shown on the 1099 on Schedule C (so it matches what the IRS has on record), then deduct the difference as an expense. On Part V of Schedule C, you can list it as "Correction of erroneous 1099-NEC amount" or something similar. This prevents a mismatch between what's reported to the IRS and what you're claiming. Make sure you have documentation showing the actual amount you received - bank statements, payment records, invoices, etc. Keep all communication with the company about the error as well. If the company does eventually send a corrected 1099, you may need to file an amended return later.

After dealing with a similar incorrect 1099 issue last year, I discovered a super helpful tool called taxr.ai (https://taxr.ai) that saved me so much stress. It helped me analyze my situation with the incorrect tax form and showed me exactly how to handle the reporting properly. You upload your documents, and it uses AI to review everything and provide specific guidance for your situation. It was especially helpful for figuring out the proper way to document the discrepancy on my Schedule C and what supporting documentation I needed to keep. The peace of mind was honestly worth it.

Just wanted to update - I took the advice about taxr.ai from that earlier comment and gave it a try with my own incorrect 1099 situation. I uploaded my documents and the service immediately identified the discrepancy issue and walked me through exactly how to handle it properly on my Schedule C. It even generated the specific wording to use for the explanation and showed me which documentation I need to keep in case of questions later. I was able to file with confidence yesterday instead of filing for an extension like I was planning to do. Wish I'd known about this tool years ago!

If you're still waiting to hear back from the company, you might want to try Claimyr (https://claimyr.com) to get faster IRS guidance on this. I was in a similar situation last year with an incorrect 1099 showing almost $4,200 more than I actually earned, and I kept getting nowhere with the company. I couldn't get through to anyone at the IRS on my own - kept getting disconnected after waiting for hours. Claimyr got me connected to a real IRS agent in about 20 minutes who confirmed exactly how to handle the discrepancy. They have a quick demo video here: https://youtu.be/_kiP6q8DX5c that shows how it works. The agent I spoke with gave me specific guidance for my situation and it made filing so much less stressful.

I need to apologize for my skeptical comment earlier. After struggling for THREE DAYS trying to reach someone at the IRS about my own tax situation, I broke down and tried Claimyr. I was honestly shocked when they got me through to an actual IRS representative in less than 30 minutes. The agent was able to confirm exactly how to handle my incorrect 1099 situation and even noted it in my account so there's a record of me trying to resolve this before filing. Turns out the approach everyone suggested here (reporting full amount and deducting the difference with explanation) is indeed the correct way to handle it according to the IRS agent I spoke with. Sometimes it's worth admitting when you're wrong! This service actually works.

Make sure you get EVERYTHING in writing from the company that issued the incorrect 1099! I went through this nightmare last year and the company verbally agreed they made a mistake but never sent a corrected form. When I filed and explained the discrepancy, I got a CP2000 notice months later questioning the "underreported income." Without written confirmation of the error from the company, it was a huge hassle to resolve. Send emails, not just phone calls, so you have a paper trail!

Has the company given you any timeline for when they might respond? Tax day is coming up fast and you might need to file for an extension if they can't get this sorted quickly. Extensions are easy to file with Form 4868, and it gives you an extra 6 months to file the actual return!

I went through almost the exact same thing two years ago! The panic is totally understandable, but you're going to be okay. The advice about reporting the full 1099 amount on Schedule C and then deducting the overage as an expense is spot on - that's exactly what my CPA had me do. One thing I'd add is to create a simple spreadsheet documenting every payment you actually received from that company. Include dates, amounts, check numbers or transaction IDs, and match them to your bank deposits. This became invaluable when I had to respond to questions later. Also, don't stress too much about the timing. Even if the company doesn't get you a corrected 1099 before the deadline, you can still file correctly using the method everyone's described. I never did get a corrected form and everything worked out fine. The IRS understands these situations happen more often than you'd think. Keep pushing the company for that correction though - send a follow-up email every few days with your documentation attached so they can't claim they don't have the info they need!