City is widening road in front of clients house and temporarily cut off access to irrigation. City told client to have a temporary line installed and to send City the receipts for amounts she paid and City would reimburse her. She did and they did.
End of year City sends client 1099-NEC for the amount reimbursed ($700). Now, as I see it, she has to report it as income from business or hobby or? I question it. She contacts City that she is neither a contractor nor a hobbyist, simply did what they told her to do. City reissues a CORRECTED 1099-NEC with boxes 1-5 and 7 blank (which is correct according to I. Now, as I determined, she does not need to report the 'income', but retains the 1099-NEC and receipts if taxing agencies have any questions. So far so good.
My questions are: In the event a City or any other entity required to file 1099-NEC/Misc did not want to revise or correct the 1099 would it be 'reasonable' to file a Sched C with $700 income and $700 expenses for a net zero. Is there a different way this could have been handled other than Corrected -NEC/MISC or filing a Sched C. thanks
