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@JamesTC wrote:

 

Do I just present the facts to the board president and leave the decision up to them.

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That is what I would do.

But I would also emphasize:  (a) if the contractor correctly reported his income, there will be no harm to the contractor and (b) if the contractor was not reporting his income, in my opinion you need to look at the books much closer to determine if there is anything else questionable, such as he was doing anything for his personal profit.

There could also be penalties for filing late 1099s, although the IRS may not assess the penalties.