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Discussion Forum Index --> Basic Tax Questions --> Issue a 1099 for this???
Discussion Forum Index --> Tax Questions --> Issue a 1099 for this???
FLAcct (talk|edits) said:
| 9 June 2009
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| I have a client who owns a bar. Last year the bartender threw a beligerent/drunk patron out the back door and guess what? He sued the bar for an injury sustained in the fall. The bar settled with the patron before it went to trial. Instead of paying all of the settlement money to the patron's attorney, they paid just the legal fees to the attorney and paid the patron directly for the settlement. The question is: does the bar need to issue a 1099 to the patron? I have read the 1099 instructions and do not see a reference to this, but I am wondering if anyone else has had any experience with this. Of course, I know that a 1099 needs to be issued to the attorney. Thanks for your help.
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Csg (talk|edits) said:
| 9 June 2009
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| I have clients who have settled similar suits and the terms of the settlement specified that the income would be reported on a 1099. I would check the settlement documents and see if the issue is addressed.
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Taxea (talk|edits) said:
| 10 June 2009
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| Did the atty, by chance, as the bar to pay the patron directly? If so, is it in writing...if so, or not I would issue a 1099 to both.
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Mikex2e7n5 (talk|edits) said:
| 17 June 2009
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| Nothing wrong with issuing a 1099 to the patron. Code and regs state who you HAVE to issue to. No mention as to who you CAN'T issue to as long as it was real.
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