Can a third party employer of a freelance job demand a refund using a 1099 tax form?
I did a freelance job for a Bride. She was pleased with the work my partner and I did, but the Bridesmaid was not. The bridesmaid then demanded a full refund (we charged the Bride $120). Since we were advised from our school we were legally in the right, we did not grant her wish. Now, the Bride has contacted me saying she is going to fill out a 1099 tax form that will some how force me to pay her the $120. Now, she only has my name and cell phone number, not address. So I'm wondering two things: 1) Can this tax form force me to give her the refund? 2)Can she fill out this tax form without my contact information? (Boils down to me, if the IRS doesn't know where I am, how will they bill me?) Thank you for your help :)
Other - Taxes - 2 Answers
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1 :
Hi, i don't see how this tax form can force you to pay the $120. It is a form used to declare revenue.
2 :
The bride has no clue what she is talking about. A 1099 form is used to declare income not request a refund. It is given to a freelancer who earned $600 or more in one year from the client. That's not you. For the client to provide you with a 1099, you would have to provide them with a W9 which states your tax id number/social security number, address, and formal name. The way this works is the client asks you to complete a W9, you fill it out and return it to them. The bride (not the bridesmaid) can take you to small claims court if she wanted to get her money back. Besides that, I don't see any recourse on her part.
3 :
1. Since the wedding was clearly not part of HER ordinary business, a Form 1099 would not be necessary. All that it does is serve notice upon you and the IRS that you received some amount of money. Assuming that you are showing that income on your tax return you have nothing to fear. 2. If she tries to file a Form 1099 without your SSN on it, the IRS will stick her with a $50 penalty unless she can show evidence of her due diligence in securing your name, address, and SSN. 3. Filing a Form 1099 does not create any liability to you to refund any money. It's just a record of an amount of money paid to you. The purpose is to ensure that you report the income AND to give the payer the evidence necessary to deduct the cost. (And that is why you don't prepare a Form 1099 for non-business expenditures, since there's nothing for you to deduct in the first place.) My guess is that "Bridezilla" is taking tax advice form a Tax Moron. Let her stew in her ignorance. The only way that she can "force" you to refund the money is to sue you in Small Claims Court and win. For $120 that's not likely to happen, though she is free to do so if she chooses. Since the brides
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