I just received my Intellishop 1099 miscellaneous form. This is the first 1099 I had ever received from them because I have never worked with them before. I don’t know how they figure out their compensation, because I did it both with only the fees and with both the fees and the reimbursement for my purchases. And with Either way I am still showing that I am almost to $300-$125 difference from what they say that they paid me. They obviously tell me that they paid me more than what they really did. I made sure that it was from December 2017 to November 2018 because those were the span of months I was paid in 2018.Has anyone else ever had this problem before and what do I do?

[budgeting.thenest.com]

...here's a question...what does one do when a MSC issues a 1099, but the amounts listed as earned are inclusive of expenses incurred in doing the shop ...example is 360 Intel and others, which pay a flat fee for the shop that includes the cost of food, for example....

One reports all receipts earned - on 1099 or not. And then one takes as business expenses those things which are expenses (e.g. a required purchase) listing the expenses on the appropriate lines of Schedule C (for example, "Working Meals."

But what do I do when the 1099 misc amount is wrong regardless?

Maynardm2 is it over or under the amount you made?

You try to get it corrected and if you can't you just adjust your non-1099 income by an amount that will make it come out right. Your MS income almost certainly exceeds your 1099 amounts so if you report what your records show you made it won't matter that one of your 1099s was wrong.

@maynardm2 wrote:

But what do I do when the 1099 misc amount is wrong regardless?

Edited 1 time(s). Last edit at 02/09/2019 11:34PM by panama18.

@Rousseau wrote:

One reports all receipts earned - on 1099 or not. And then one takes as business expenses those things which are expenses (e.g. a required purchase) listing the expenses on the appropriate lines of Schedule C (for example, "Working Meals."

I wouldn’t suggest listing required purchases under “meals” because you can only deduct 50%.

What is your recommendation for expenses being listed as?

1099 forms are reported on a Tax Year basis, not on the basis of when you did the work. You need to look at money you received from January 1, 2018 through December 31, 2019. You may well have been paid in 2018 for work done in 2017. And some work you did in late 2018 will probably not be paid until 2019. It is not possible that the 1099 covers payments from December 2017 through November 2018 because that spans 2 different tax years and in addition would also omit payments made in December 2018.

@maynardm2 wrote:

I just received my Intellishop 1099 miscellaneous form. This is the first 1099 I had ever received from them because I have never worked with them before. I don’t know how they figure out their compensation, because I did it both with only the fees and with both the fees and the reimbursement for my purchases. And with Either way I am still showing that I am almost to $300-$125 difference from what they say that they paid me. They obviously tell me that they paid me more than what they really did. I made sure that it was from December 2017 to November 2018 because those were the span of months I was paid in 2018.Has anyone else ever had this problem before and what do I do?

I suggest contacting Intellishop and figure out how they came up with the amount on the 1099. If the amount is incorrect, they should give you another "corrected" 1099 to you quickly. When it comes to my taxes, I want everything to the penny. I don't want anything that would point a finger at me with the IRS. If the amount you report is different from that of the 1099, it can cause a flag at the IRS.

@maynardm2 wrote:

But what do I do when the 1099 misc amount is wrong regardless?

Did they pay you in 2018 for any shops in 2017 that were performed before December? Remember, they just report all payments made in 2018 regardless of when you performed the assignment.

I just got my looooong awaited intellishop 1099 and its wrong -- not even close. It doesn't even match the total fees on their own website and it doesn't match my personal records. Will they find the mistake and eventually reissue or is it up to me to raise a fuss? The form they sent underreported by ~$300.

Yes they stated that they used the wrong information and I had to have it corrected

@nolimitem wrote:

What is your recommendation for expenses being listed as?

"Shop expense"

@ArkLaMissshopping wrote:

I suggest contacting Intellishop and figure out how they came up with the amount on the 1099. If the amount is incorrect, they should give you another "corrected" 1099 to you quickly. When it comes to my taxes, I want everything to the penny. I don't want anything that would point a finger at me with the IRS. If the amount you report is different from that of the 1099, it can cause a flag at the IRS.

@maynardm2 wrote:

But what do I do when the 1099 misc amount is wrong regardless?

I suggest you put on a schedule (like on excel) the date payment received, name of client, job fee, reimbursements. Start with either your shop long from December 2017 to November 2018 and tie it out to payments received Janaury 2018 to December 2018. I don't remember if Intellishop paid early for some of the jobs in December 2018. I know Customer Impact and some others paid early but make sure you include all payment receieved in 2018 (even December 31, 2018 that didn't transfer to your bank until 2019).

Ditto. I just figured everything out and they under reported me as well by about $215. My tax accountant spouse and I have looked through everything twice (and it matches what I recorded during the year). Blah.

They gave me an explanation that made little sense. Given their payment hiccups and now the tax form flub, one can only be waiting for the next screw up to happen.

I think you would not be taxed according to what months you were paid but according to what months you actually worked.

There are actually two different forms of accounting. You are describing accrual accounting. You book revenues and expenses when they are incurred Generally, that would coincide with when the work was performed. The alternative is often called cash accounting. You record expenses when you spend the money, and you record revenue when you are actually paid.

Suppose you do mystery shopping in September 2018, earning $2000 in fees, and spending $300 in reimbursable expenses. You are not paid or reimbursed by the MSC until the following February 1, 2019. In accrual accounting, you would owe tax on $2000 for the fiscal year including September, so on January 15, 2019 (when estimated taxes are due), you might have to send the IRS 25% (or whatever your marginal rate is) of $2000 = $500 before the MSC even pays you on February 1, 2019. With cash accounting, if this was all you work you did as an independent contractor in 2018, you would have a loss of $300 for Tax Year 2018, and revenue of $2300 for Tax Year 2019.

This is somewhat simplified, but the overall idea is, I believe correct. When you file your income tax for the first Tax Year in which your business was active you have to decide whether to use cash or accrual accounting. This is indicated on Schedule C. Without the permission of the IRS, you can not change the method for future years.

@alannajm wrote:

I think you would not be taxed according to what months you were paid but according to what months you actually worked.

As a follow up. I was told I'd get a new 1099 from them, but when I did not receive one, I called back. I was told that they did indeed mess up (forgot an entire month), but they were not going to fix it and would not be sending me a new one. I called the IRS directly and they told me how to handle when filing my taxes.