1099 Misc instead of 1900NEC

[rtsietsema]

Pardon me if this was addressed, but I have a long time self-employed client who received a 1099Misc with box 3 reporting an amount. I believe this company was either lazy or missed the update to use Form 1099NEC for Non-employee compensation.

The question is, would it potentially be a problem to use it as is and apply it to Schedule C or should I request the issuer to correct the situation?

Thank you for taking time to respond.

[Rapid Robert]

I was surprised how many I deal with who seemed to have no clue about 1099-NEC, even though its use was announced well over a year ago. (Even on tax forums, professionals in 2020 seemed mostly oblivious, referring to 1099-MISC when it was clear they really meant 1099-NEC). I guess the IRS publicity was pretty minimal.

What is reported on Schedule C is not determined by the 1099-NEC forms you receive or don't receive, and the 1099-NEC/1099-MISC info is not included in the tax return efile data (unless perhaps there was withholding).

So, while it is the issuer's responsibility to correct the mistaken 1099-MISC (to zero) and issue a 1099-NEC instead (which is now late), it shouldn't affect the tax return numbers.