Originally Posted by elleshanklin
I filed our taxes about 3 weeks ago using turbo tax and just received a 1099-Misc a week ago. My question is the 1099-misc is showing nonemployee compensation for an amount of money that was used to 'buy out' my husband's previous employer for some educational training he was completing at his previous job. So his new employer paid him the exact amount of money that went to his old employer to pay off his training that was owed. So, we didn't technically ever use or see this money as income. When I went back to amend the turbo tax form it showed a significant decrease in our refund. Anyway to remedy this? Thanks!
In the event a taxpayer submits an erroneous tax return to the IRS, what happens next depends on the type of error. As the issuer of the 1099 followed correct procedure, the IRS already has the information on file. Your return should match the data provided by the business that filed the 1099. Data on 1099 forms affect income and the IRS makes clear that incorrect reporting of income is one of the specific reasons you should file an amended return. Furthermore, transactions reported on 1099 forms may affect tax return form sections on deductions, tax liability, payments and refunds. You need to file Form 1040X to amend federal tax returns 1040. A copy of the omitted 1099 form should be attached and filed with the amended return only if federal taxes were withheld. As you are subject to tac refund, a tax amendment has to be filed within 3 years of the date the original tax return was due, or within 2 years of the date you paid the tax, whichever is later. If you owe taxes, you should file an amended return even if 3 years have passed. Refunds are forfeit after 3 years, but tax debts stay on the books for a minimum of 10 years. a tax amendment must be filed by mail; the IRS does not allow it to be efiled.