How a Simple Government Form Can Turn in Embezzlers

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 in that turning an embezzler over to the Internal Revenue Service can result in restitution more quickly than taking him or her to court.

My advice? If you want to report an embezzler, do not use Form 1099-MISC or a W-2 to.

• 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.

Instead of using From 1099-MISC, I recommend you use Form 3949A.

It’s a simple 1 page form that you can download here: IRS Form 3949A

For Canadian Dentists

Canada’s tax laws also treats gains due to theft or defalcation as taxable income.

For more information, and to download the forms, visit CRA Tax Folio S3-F9-C1

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 in that turning an embezzler over to the Internal Revenue Service can result in restitution more quickly than taking him or her to court.

My advice? If you want to report an embezzler, do not use Form 1099-MISC or a W-2 to.

• 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.

Instead of using From 1099-MISC, I recommend you use Form 3949A.

It’s a simple 1 page form that you can download here: IRS Form 3949A

For Canadian Dentists

Canada’s tax laws also treats gains due to theft or defalcation as taxable income.

For more information, and to download the forms, visit CRA Tax Folio S3-F9-C1

Listen to Frank speak about using 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.

Have Embezzlement Concerns? Give me a call.

William Hiltz BSc MBA CET