Frank Abagnale (“Catch Me if You Can”) advises using Form 1099-MISC

In the video below, Mr. Abagnale says filing a 1099 is one of the best options for those who have been affected by embezzlement, and he’s partly right. Turning an embezzler over to the IRS can result in restitution more quickly than taking him or her to court.

My advice? Do not use a 1099-MISC or a W-2 to report taxpayer income from embezzled funds.

W-2s are submitted to report compensation from work performed, and embezzling is not legitimate work.

Form 1099-MISC is intended to be used to report payments made to a “non-employee” for fees, commissions, prizes, and awards.

Use Form 3949A instead!

You can download it here: IRS Form 3949A

For Canadian embezzlement victims – the Canada Revenue Agency has replaced its Form IT-256R with Tax Folio S3-F9-C1.

Frank speaks about issuing a 1099 to report fraud. (Frank William Abagnale Jr. is an American security consultant known for his career as a con man, check forger and impostor when he was 15 to 21 years old)

Embezzlement Concerns? Give me a call.

William Hiltz BSc MBA CET

Bill Hiltz is the CEO of
Hiltz & Associates
and the creator of
Dental FraudBusters.