Comments on: 1099 Abuse http://www.pappasontaxes.com/index.php/2009/12/14/1099-revenge/ Pappas on Taxation Thu, 09 Feb 2012 04:09:25 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Peter http://www.pappasontaxes.com/index.php/2009/12/14/1099-revenge/comment-page-1/#comment-4828 Peter Mon, 22 Mar 2010 15:51:51 +0000 http://blog.pappastax.com/?p=12146#comment-4828 Robert, The answer is not as simple as it might appear. I would have to see the class action complaint as well as the settlement agreement. If any portion of the damages are for back pay, for instance, they could be subject to tax. Hire someone to look at this for you before you sign your return. Robert,

The answer is not as simple as it might appear. I would have to see the class action complaint as well as the settlement agreement. If any portion of the damages are for back pay, for instance, they could be subject to tax.

Hire someone to look at this for you before you sign your return.

]]> By: Robert http://www.pappasontaxes.com/index.php/2009/12/14/1099-revenge/comment-page-1/#comment-4823 Robert Sun, 21 Mar 2010 23:12:46 +0000 http://blog.pappastax.com/?p=12146#comment-4823 My wife received a substantial check from a former employer as a result of a class action lawsuit for sexual harassment. When we received the settlement, it was stated that the payment was for damages (which I understand to be non-taxable, right?). Moreover, we received the check in February, 2010 even though it was dated for last October, 2009. Now we've received a 1099-MISC that reports the full amount as other income, but that means I have to pay taxes on it, right? Is there a way to contest the type of income reported, and am I right to think it ought to be tax-free? Also, if I didn't receive the payment until 2010, should I pay taxes on it this year or next? My wife received a substantial check from a former employer as a result of a class action lawsuit for sexual harassment. When we received the settlement, it was stated that the payment was for damages (which I understand to be non-taxable, right?). Moreover, we received the check in February, 2010 even though it was dated for last October, 2009.

Now we’ve received a 1099-MISC that reports the full amount as other income, but that means I have to pay taxes on it, right? Is there a way to contest the type of income reported, and am I right to think it ought to be tax-free? Also, if I didn’t receive the payment until 2010, should I pay taxes on it this year or next?

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