I filed a 1099 on one of our employees by mistake instead of putting that extra income into his W-2. I have corrected it with our payroll company but they require me to file the proper forms. I know I need to send in a W-2c along with a W-3c, that's no problem. I need to know the correct way to "undo" a 1099. Do I submit all 1099's that were previously submitted and submit his as well with 0 dollars along with a corrected 1096? Or do I just send in the other 1099's and a corrected 1096?

You need to submit an amended 1096 Report and should only include the correct 1099-Misc. In addition, you should indicate the the word "AMENDED" on the 1096-Annual Transmittal Form that is being sent to the IRS.

For your information, you are not required to attach the incorrect 1099-Misc and show a zero amount.

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