A corp provides a payer with a W-9 which shows that it is a corp and exempt from 1099 reporting. The payer issues a 1099-MISC.The corp persists that it is not subject to 1099 reporting. The payer disagrees. How do you respond?

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1099 reporting can be a complex undertaking for payers, and if they do not report payments when they should, they can face taxes and penalties. So if payers are unsure, it is safer for them to issue a 1099 than not. Taking it to extremes, some, like your payer, simply issue 1099s across the board.

However, the payee does not face consequence when the payer fails to issue a 1099, or issues an unrequired 1099. When you receive a 1099, you may simply disregard it. There is no harm to you in the payer issuing an unnecessary 1099.

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