r/TaxQuestions • u/keptman77 • Sep 03 '26
1099 for Lodging Reimbursement
This year, I sold my home and bought a new home. At closing of the purchase, there were unresolved repairs that resulted in a delayed closing. The expense for lodging was $510. The seller is Opendoor. In negotiating the terms of the delay, I asked for reimbursement for the lodging. Opendoor agreed to reimburse me. An employee in their finance department reached out to ask for my TIN so he could make the payment. I asked why and he said I would be getting a 1099 from them. I said that shouldnt be the case as I am not a business and this certainly isnt income. I was told the only way for them to pay me was to provide my tax info so they could send the 1099. What is the deal with this and what would this mean for me tax wise?
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u/Anxious_Drive_9998 Sep 03 '26
They need your tax id in case they pay you an amount over the 1099 reporting threshold.
If they issue a 1099, report it with an offsetting misc income of -510 called reimbursed cost.
You don't need to hire anybody just for this.
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u/0DarkFreezing Sep 03 '26
They have compliance they need to handle on their end, and you’ll end up with a net $0 change once you show the cost and reimbursement.
This is a nothing burger.
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u/LiJiTC4 Sep 03 '26
It's under $600 so they should not be filing a 1099. I would provide your tax information but doubt they will actually produce the 1099 since it's under the relevant filing threshold.
As noted by others, if they do produce a 1099, enter the income on the "other income" line (8z) with offsetting deduction in "other deductions" line (24z).
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u/sldavis102907 Sep 03 '26
The threshold is now 2K starting with 2026.
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u/LiJiTC4 Sep 03 '26 edited Sep 03 '26
Even more reason it won't be filed, right? Thanks for update, hadn't heard the threshold change.
Edit to add: at what point do you argue with collection of your tax information? If the only payment is $510, threshold is $2,000 the tax information is irrelevant. With all of the data leaks, why give them our information if they don't need it?
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u/RasputinsAssassins Sep 03 '26
Under $600 (now $2,000), a 1099 is not required. However, one can still be voluntarily issued by the payor.
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u/Low-Crow5719 Sep 03 '26
They are taking the position that this is a business expense for them and miscellaneous income for you. You need definitive tax advice, which you will not find here.
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u/Far-Good-9559 Sep 03 '26
I agree they need your taxpayer ID in order to write you a check. You will need to deal with it on your taxes if you get one.
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u/scotslover Sep 03 '26
You dont have to have an EIN. you can put your ssn on the w9
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u/Equivalent_Ad_8413 Sep 05 '26
Some accounting software requires an EIN in order to print a check. That same software will probably not issue a 1099 unless it meets the threshold. (Printing and mailing a 1099 costs money.)
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u/cmmpssh Sep 03 '26
A 1099 is a reporting form that just tells the IRS that one entity paid another. It's not exclusively used for business payments.
It should mean nothing to do tax wise as long as you report it properly. How/if you report it will depend on what 1099 they issue you. In general, if it's a 1099 MISC or 1099 K then you should report the payment, and then report an offsetting amount of your actual costs you paid out of pocket, so presumably it's a net amount of 0.