Theoretically you will be in trouble but as long as USCIS doesn't know it, you are fine because IRS doesn't talk to USCIS.
-The problem is that the school has sent the 1099 to IRS and USCIS will check the I-485 applicant's employment record during the I-485 processing and they will find it.
I saw this issue has been raised for one thousand times on this forum. You just keep it quiet and you are OK. You can search this topic on this forum or google it.