Rents/Vehicle reimbursement reported incorrectly on a 1099 MISC

[Azaustin19]

I have 2/clients that had reimbursements for travel reported on a 1099 misc rents and other income. I know this should have reported differently. I had suggested they go get them corrected. The company is now out of business and the IRS is stating they both owe over 3K. They were travel/vehicle reimbursements, what should I do? This is the first situation I have had like this. Is there a form I can fill out to let the IRS know it was reported wrong. Would appreciate any advice.