Form 1099-G: Certain Government Payments (2024) – A Complete Guide

If you received unemployment benefits or a state income-tax refund in 2024, you’ll likely see Form 1099-G in early 2025. Agencies send it to you and to the IRS. This guide explains what the form reports, when amounts are taxable, where to put them on your return, and how to avoid common pitfalls.

What the form is for

Government agencies issue Form 1099-G to report these common payments:

• Box 1 – Unemployment compensation. Regular/extended state benefits and certain federal or RRB unemployment payments. Amounts are gross (before withholding).
• Box 2 – State/local income-tax refunds, credits, or offsets. May be taxable depending on whether you itemized last year.
• Box 5 – RTAA payments. Wage supplements for certain workers affected by foreign trade.
• Box 6 – Taxable grants.
• Box 7 – Agriculture payments. (e.g., USDA programs)
• Box 4 – Federal income tax withheld. Voluntary or backup withholding.

You don’t file the form itself—use it to prepare your return. The IRS already has a copy.

When you’ll use it (late/corrected)

• Agencies must furnish 1099-G by January 31, 2025 (for 2024 payments). Many states also post forms in online portals.
• Didn’t get it in time? You still must report the income. Pull the amounts from your online account or payment history and request a duplicate from the agency.
• Looks wrong or identity-theft? Contact the agency immediately for a corrected 1099-G. Report only income you actually received. You can also file Form 14039 (Identity Theft Affidavit) and notify your state/DOL fraud unit.
• Already filed and found an error? File Form 1040-X to amend (the IRS now accepts most 1040-X returns electronically).

Key rules for 2024

• Reporting thresholds. Agencies issue 1099-G for $10+ unemployment or tax refunds; $600+ for RTAA and many grants/ag payments.
• Unemployment is taxable federally. Report the full Box 1 amount on Schedule 1 (Form 1040), Part I, line for Unemployment compensation (flows to Form 1040). You may elect federal withholding (often 10%) when you claim benefits.
• State refunds may be taxable—sometimes. A Box 2 refund is taxable only if you itemized last year and got a tax benefit from deducting state/local income tax. Use the State & Local Income Tax Refund Worksheet (see Schedule A instructions) to compute the taxable portion.
• Repayments matter. If you repaid a 2024 unemployment overpayment in 2024, report net income (Box 1 minus repayment) and retain proof. If you repaid in a different year, special rules apply (deduction/credit).
• Don’t attach the 1099-G. Keep it with your records; the IRS already has it.
• Backup withholding. If Box 4 shows withholding (e.g., missing/incorrect SSN), claim it on your Form 1040 with other federal withholding.

Step-by-step (quick)

1. Verify the form. Check name/SSN and amounts. Confirm the payments are yours (fraud checks!).
2. Decide what’s taxable.
   • Box 1: Unemployment → taxable.
   • Box 2: State refund → run the worksheet only if you itemized last year.
   • Boxes 5–7: Usually taxable; see program-specific rules.
3. Report on the right line.
   • Unemployment: Schedule 1 (Form 1040), Part I – Unemployment compensation.
   • Taxable state refund: Schedule 1 (Form 1040), Part I – Taxable refunds/credits of state/local income taxes.
   • Other amounts: Usually Schedule 1 – Other income, or a business/farm schedule when applicable.
4. Claim withholding. Enter any Box 4 federal withholding on Form 1040 (federal income tax withheld).
5. Keep records. Store the 1099-G, worksheets, and repayment proofs for at least 3 years (7 is safer).

Common mistakes (and fixes)

• Skipping unemployment income. The IRS matches 1099-G—always include Box 1.
• Automatically taxing state refunds. Only taxable if you itemized last year and got a tax benefit. Otherwise, don’t include it.
• Not netting same-year repayments. If you repaid 2024 benefits in 2024, report net income and keep documentation.
• Reporting the wrong year for refunds. You report a state refund in the year you received it (2024). Box 3 (if present) identifies the prior tax year the refund relates to for worksheet purposes—it doesn’t change the reporting year.
• Ignoring fraudulent 1099-G. Don’t report phantom income. Get a corrected form and document your fraud reports.
• Forgetting multi-state payments. Received benefits from two states? You’ll get two 1099-Gs—combine them.

Tiny examples

Unemployment + withholding

• Box 1 = $9,200; Box 4 = $920.
• Report $9,200 on Schedule 1 (unemployment).
• Claim $920 on Form 1040 with other withholding.

State refund recovery

• You itemized in 2023 and deducted state income tax.
• 2024 1099-G Box 2 = $600.
• Use the worksheet; if only $380 produced a prior-year tax benefit, report $380 (not $600) on Schedule 1 (taxable refunds).

What happens after you file

• IRS matching. The IRS compares your return to all 1099-G filings. If everything ties, processing is normal (e-file + direct deposit often within 21 days).
• Mismatch? You may receive a CP2000 proposing changes. Respond by the deadline—agree and pay, or explain with documentation (e.g., worksheet, corrected form).
• State returns. Unemployment’s state taxability varies; check your state rules. State refunds on 1099-G are usually not taxable to the state.

FAQ

Do I attach the 1099-G?
No—just report the amounts; keep the form with your records.

Didn’t receive the form?
Check your state portal or request a duplicate. You must still report the income.

Is all of Box 2 taxable?
No. Only to the extent you itemized last year and got a tax benefit from the deduction.

Got a fraudulent unemployment 1099-G?
Contact the agency for a corrected form; file your return with only real income. Consider Form 14039 and notify the DOL/state fraud unit.

Can I withhold tax from unemployment?
Yes—you can elect federal withholding (commonly 10%) through your state UI system.

Benefits from two states?
Combine all Box 1 (and Box 4) amounts across your 1099-Gs.

I repaid benefits—different year than received.
You may qualify for a deduction/credit in the repayment year if over $3,000. Keep all notices and proof; see Publication 525.

One-page checklist

• ☐ Pulled all my 2024 1099-Gs (state portal checked)
• ☐ Verified SSN/name and each box amount
• ☐ Unemployment (Box 1): Reported on Schedule 1 (unemployment)
• ☐ State refund (Box 2): Ran worksheet only if I itemized last year; reported only taxable portion
• ☐ Withholding (Box 4): Claimed on Form 1040 with other withholding
• ☐ Fraud/identity-theft? Requested corrected form and documented reports
• ☐ Repayments: Netted same-year, or noted deduction/credit rules for different-year repayments
• ☐ Saved everything (form, worksheet, repayment proof) ≥ 3 years

What I changed (so you’re aware)

• Clarified that state refunds are reported in the year received; Box 3 only identifies the prior year for the worksheet.
• Updated to reflect that most 1040-X returns can be e-filed now.
• Kept reporting line references generic enough to avoid micro-line drift, but still precise (Schedule 1 categories + Form 1040 withholding line).

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