1099 NEC multiple states

Forum|Forum|1 year ago
October 3, 2024
8 replies
25 views

Client is a financial advisor. She has always received 1099NEC income in the past. This year, her income is allocated to multiple states. She does not travel to these states and performs all the work in her resident state of NY. Has anyone else seen this and do you file for the other states? There are several of them.

Thanks

ProSeries Professional

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Best answer by IRonMaN

If she never worked in those states, doesn't have any business property in those states, and doesn't pay payroll in any of those states, it is hard to say that she earned that income in those states. Until he passed away, I did a tax return for an Ameriprise advisor that received those same reports. We never filed a return other than a Minnesota return for him.

IRonMaN

Level 15

When you say multiple states, do you mean you saw a report generated by the company listing various state commissions that make up the total 1099 total? If so, yeah, I've seen that.

If she didn't spend any time in those other states, just report it all as earned in NY.

Slava Ukraini!

L

lauriem33Author

Level 5

Yes, but:

"Nonemployee Compensation reported to the state of" That's the part that has me concerned.

It's from Ameriprise. The client has always had all income reported to the resident state. This is new this year.

IRonMaNAnswer

Level 15

If she never worked in those states, doesn't have any business property in those states, and doesn't pay payroll in any of those states, it is hard to say that she earned that income in those states. Until he passed away, I did a tax return for an Ameriprise advisor that received those same reports. We never filed a return other than a Minnesota return for him.

Slava Ukraini!

BobKamman

Level 15

Is this because she has clients in those states? Or because she sells products issued in those states? "Annuities and insurance products are issued by RiverSource Life Insurance Company, Minneapolis, Minnesota, and in New York only, by RiverSource Life Insurance Co. of New York, Albany, New York." (I suppose because you can get away with stuff in Minnesota that you can't get away with in New York.)

PATAX

Level 12

Just because they issue those reports, does not mean that it is accurate. Had a client last year, High income client with a very large corporation, whose W-2 had small amount of earnings allocated to a far-off state that he never was in, and he didn't actually even know that it was on his W-2. Unfortunately because it was on his W-2, I had to file a state return for that state so he could receive his refund from it.

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