This is a new one for me. We were dealing with a major plumbing supplier (I despised their accounting system, but I digress). We returned a 40 gallon electric water heater due to a fubar with a customer back to said supply house.

Said supply house stated they never received the return and kept the invoice in the portal for MONTHS until I wrote the big wigs. They finally took it off along with several other credits that they, when doing their audits, discovered needed to be credited back to us.

I have a photo of it on the pallet with "return to vendor" stickers. This company has had some dodgy hiring practices late 2024 as well as truck drivers and it wouldn't surprise me in the least if one of the delivery people made of with it. We certainly would not steal a water heater as we have virtually no room for any inventory and work on a "just in time" basis.

Well doncha know, said supply house sent us a 1099-MISC for the value of the MIA water heater!

This was the nail in the coffin for this supplier. Finally hubby is in agreement to close the account! Again, their accounting system was awful and I was always being overcharged or it took 2-3 months to get the sales tax off of a tax exempt customer's invoice. I literally dreaded the 9th of every month.

Weird. What box did they put the amount under? Just "3 Other Income", I assume?

In the end, unless it is a huge figure, it likely won't matter. While the IRS gets copies of 1099s, you don't send them with your return or anything. File your return as normal and it will likely be fine.

That being said, I wonder if it is worth it to send them a letter and keep a copy stating that you believe the 1099-MISC to be incorrect. So that you have some documentation that you tried to get them to correct it.

I'm not an expert though. Curious of Marv's take on this one since he knows most of this best.

John,

It's not a huge figure, hubby is all about the principle, but I'd rather just cut bait and run.

My accountant, who used to work for the IRS, would * a note stating you believe the 1099 MISC to be incorrect, and attach a copy of the letter you send to the company stating the same, with more of an explanation.

And while your husband approves, I would change suppliers.