If we make a payment to a vendor in December of 2015, and report it on their 2015 1099, how should it reflect on their 2016 1099 if a stop-pay is placed (because the check is lost) and a check is reissued...

Follow

Q. (cont.) Does that amount get reported again, or does it net to zero since there was a stop pay/void placed on the check?

A. We spoke with IRS information specialist Ms. Sutton (#1002213914), and she referred to IRS Publication 525, Taxable and Nontaxable Income. The income is considered ""constructively received"" in 2015 (page 2), meaning the vendor technically had the payment made available to him even though it was not actually in his possession. Therefore, you were correct to report it in 2015, and do not need to report it again for 2016.

Have more questions? Submit a request

Comments