I've received a 2008 1099-MISC for money I did not receive in 2008.

This was from a company I worked with in 2006 and this money was a subsidy. I did receive other money from them in 2006 for which I received a 1099 and claimed.

I rang the company and they informed me that they converted the subsidy to income in February of 2008 and there was nothing they can or will do to correct the 1099.

I did call the IRS and they were not very helpful. I was told I need to claim it or be subject to penalties. They did state that I should dispute this with the company, a process I've begun. But, otherwise, they trust the 1099 and not the taxpayer. There is noting that I can provide to the IRS to prove I did not receive this money in 2008.

Does anyone have any experience in this kind of situation. Any ideas?

Thanks.

Contact the company to find out how they treated the subsidy in 2006. May be you will have to amend your 2006 tax return and report it on 2008 tax return.