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RE: Rawze's simple Tax Advice... - Rawze - 02-23-2017
What to do if you get a 1099 that you think is incorrect by a carrier you are leased onto ...
First thing you can do if you want to make sense of it is add up all the GROSS totals on your Settlements for the year from them. This is the total of all they claimed you made BEFORE ANYTHING WAS DEDUCTED AT ALL!. If it matches then the 1099 is correct. If it is more, then go look in your bank, com-data, etc. for any money they might have given you that was NOT on your settlement. Sometimes it is hard to find out how someone 1099'd you but it can usually be figured out.
Worse case, if someone 1099'd you and it is a flat out lie. Call em up and try to get a detailed report to how they got the figure. Someone somewhere figured it out, so try to get a copy of that. If they refuse then I would just resort to adding up all the money they actually sent you first. After that subtract it from their proclaimed 1099 and use that amount as a "settlement expense". In other words, any money you did not actually receive is a loss to your business and can be claimed against what someone says you made. No big deal. It is not your job or responsibility to do their accounting. Just make sure there is a clear record of what you did to get the numbers.
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DON'T FORGET ABOUT THE INCOME THAT WENT INTO YOUR BANK!!! -- Very common mistake!. I see a lot of drivers say they only made "X" but if you go add up all the money deposited into their bank for that year. Total Income for the year the bank claims you received SHOULD NOT BE MORE than what you say you made!. -- There is no reason for it to unless you didn't claim some income properly.
-- As a matter of fact, I saw one guy who did his taxes this way about 2 years ago. He simply used his total income to his bank for the year (Money received total for year) and used that as his gross income. He then claimed all receipts against this that he had where he spent that money and did nothing else for figuring his taxes. Guy simply didn't care about any of that settlement stuff and crap at all. He didn't even keep the 1099's or settlement sheets that were sent to him, threw them away. I suppose when it comes down to it, who could dispute this?- He is claiming all he actually got, and all he actually spent against it. In my book this would still be correct as long as there were no cash or other income to him involved.
When i asked the guy why he did it that way, he told me that he lost all his documents in a house fire a long time ago and resorted to doing it that way. After that, he just found it easier to keep doing this. He had been doing his taxes for years like that.
- I.E> I doubt he would actually fail but I certainly think he would get a very hard time of things if he did get an audit.
RE: Rawze's simple Tax Advice... - shoe128 - 01-22-2020
(03-29-2016 )Rawze Wrote: I am not a tax professional but I do help a LOT of people with their taxes,...
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thanks again rawze, ive read and reread this and I will reread it again a few more times theirs a
few spot I need to remember. I do my own txs and like you say filing by a "pro is best.
keep the good words coming ,thank you