1099 Misc Forms Issued to Photographer

[Yardley CPA]

Second year preparing return for this individual.  Last year the return was MFJ and I mainly dealt with the wife.  This year, since the divorce, I am dealing with the exhusband and filing MFS.   This client is a freelance photographer.  When I prepared the return last year, the wife provided me with about six 1099 misc forms showing compensation he earned from them.  This year he indicated he had received the 1099's back in January but "trashed them".  His gross income this year is slightly higher than last years.  I asked him to try and obtain copies of the 1099's since the IRS will be looking to match them once the return is filed.  I explained what would happen if we did not report each of the 1099's on his return.  It's his preference to move forward without including them since he does not want to go back to his clients and ask for a copy or even try to obtain an abstract from the IRS.  Do I have any liability in moving forward and filing in this manor?  

[Abby Normal]

Probably not. Most of my freelancers 1099s add up to less than sales anyway. I trash all the 1099s my clients send me too.

[Max W]

If his return gets filed and the Income is less than the total of the 1099's.  He will be underreporting his income and will get a CP2000.  If it is a latge amount with penalties, etc., guess who he is going to blame?

With clients like this, I will get IRS income transcripts, and also  add up the deposits from their bank statements.  He doesn't have to go back to his clients.

When people start avoiding things, I begin to get suspicious.   Never let the client dictate what you need for the return.

[Yardley CPA]

Thanks for both replies.

I was under the impression that 1099 Misc forms were entered on the Schedule C and that the IRS was looking to match those within their system.  Obviously, my understanding was incorrect and you do not need to enter each 1099 you receive, as long as the total income is greater than the total of the 1099's.  

Thanks again!

[Lion EA]

If you're at all suspicious about his "tossed" 1099s, then make sure you keep/scan/whatever mode his P&L or his written/emailed statement of income received so you have documentation that he told you his revenues were $ X, just in case he gets that CP2000 a couple years from now. If he's sitting at your desk and saying his income was $ X, hand him paper and pen to write it down "for your file."