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Old 03-20-2010, 01:07 AM
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Gift Reported on 1099 Misc

I received a large gift in the form of a cashier's check from a principal of a company I was under contract for (doing some consulting). The check was given as a gift and is documented as such in our email correspondence.

Because we were involved in a relationship that ended, he has chosen to report it as 1099 income, presumably to avoid dealing with tax issues on his part.

I have requested that it be corrected, but have not received a response.

I would assume that since he would owe taxes on the gift, he is choosing to show it as compensation so he can deduct it from his personal taxes. It was reported on the 1099 as paid by the company, but was paid through his personal account.

If he refuses to correct it, is there any recourse with the IRS, and if I do pursue that, could he be implicated in tax fraud?

I do not want to hurt him, but this is tens of thousands of dollars and he managed how it was spent during the time we were together. (I was paid separately for my contract work and did provide invoices for all work performed.) Now that I ended our relationship, he has made many efforts to get back at me and this is apparently his latest tactic.

The 1099 was due back in February, but I have reason to believe (and correspondence to back up) that he was waiting to see if we would get back together before reporting it.

Again, the money was clearly a gift, which at one point he wanted me to pay back and later told me to keep because he loved me, so at best, he could call it a loan, but it was definitely not compensation.

Just wondering what to do now.


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