I work for a general contractor. My employer pays each employee $50 a week for fuel to for the company owned trucks. This is paid seperately from normal payroll. In addition they are required by $35/day per diem for all work on Government contracts out of our local area.

My employeer issued a 1099-MISC to everyone for the fuel expense checks and the per diem checks. They listed the total in Box 7 Nonemployee compensation. Is this correct? Shouldn't this of been included in our W-2's as we are in fact employees???