What Form 1099-G Is For
Form 1099-G (2012) reports certain government payments such as unemployment compensation, state income tax refunds, and taxable grants. This tax form is issued by government agencies, including state and federal departments, to individuals who received unemployment benefits or other qualifying payments during the calendar year. The Internal Revenue Service uses this form to ensure all taxable income, including unemployment insurance benefits and state income taxes, is properly reported on your federal tax return. Anyone who received $10 or more in certain payments must include them in their federal taxable income.
When You’d Use Form 1099-G
Taxpayers use Form 1099-G when they’ve received unemployment benefits, state income tax refunds, or other government payments in the prior calendar year. The form helps the IRS and state government agencies track taxable income and ensure accurate reporting on a federal income tax return. If you received unemployment compensation or local income tax refunds, you must include the total amount as part of your taxable income when filing your return. If you discover corrected information or an updated form after filing, you may need to amend your return.
Key Rules or Details for 2012
- Minimum reporting threshold: The IRS required government agencies to issue this tax form for any unemployment compensation or state income tax refund of $10 or more during the tax year.
- Taxable unemployment compensation: All unemployment insurance benefits, unless excluded by law, were considered taxable income that must be reported on a federal tax return.
- Due dates: Agencies had to send recipients a paper copy by January 31, 2013, and file the same information with the IRS by February 28, 2013.
- Identity protection: For 2012, agencies could truncate your Social Security number for privacy, but still had to report your complete number to the IRS.
- Corrected or updated forms: If a state agency found errors, it was required to issue a corrected Form 1099-G with the proper tax information and mailing address.
- Refunds and deductions: State income tax refunds were only taxable if you claimed itemized deductions on your prior-year federal tax return.
Browse more tax form instructions and filing guides in our Forms Hub.
Step-by-Step (High Level)
Step 1: Verify your personal information
Confirm that your name, address, and Social Security number are correct. If anything is incorrect, contact the issuing state agency or department of labor to request corrected information before filing your return.
Step 2: Review your government payments
Examine each box on the form to determine what payments you received, such as unemployment compensation, state income tax refunds, or taxable grants. Ensure the total amount matches your records for accuracy.
Step 3: Determine if payments are taxable
Check whether the reported funds are considered taxable income. Most unemployment insurance benefits and government payments are taxable, while certain refunds may not be if you didn’t claim deductions.
Step 4: Report on your tax return
Include all taxable amounts from Form 1099-G on your federal income tax return. Enter unemployment compensation on the correct line of Form 1040 and report any income tax refund as required.
Step 5: Claim any withheld taxes or credits
If federal income taxes were withheld from your benefits, claim them as credits on your return to reduce your balance due or increase your refund. This information appears in the form’s withholding box.
Step 6: Keep copies for your records
Save the form, any correspondence, and your filed tax return for at least three years. Keeping complete records helps in case of an IRS notice or identity theft concern.
Learn more about federal tax filing through our IRS Form Help Center.
Common Mistakes and How to Avoid Them
- Forgetting to report unemployment compensation: Some taxpayers assume unemployment benefits aren’t taxable, but they are. Always include all unemployment compensation from the tax form to avoid penalties.
- Reporting non-taxable state refunds: If you didn’t claim itemized deductions on your prior federal return, your income tax refund isn’t taxable. Review your filing status to avoid overpaying.
- Failing to report corrected information: If you receive an updated Form 1099-G with corrected data, file an amended return to prevent IRS notices about underreported income.
- Ignoring missing or late forms: Even if you didn’t receive a paper copy, you must still report unemployment insurance benefits and government payments shown in IRS records. Contact the agency to request access.
- Not checking for identity theft or unemployment fraud: If you receive a form for benefits you didn’t claim, report fraud immediately to the issuing state agency to correct your records and prevent misuse.
Learn more about how to avoid business tax problems in our guide on How to File and Avoid Penalties.
What Happens After You File
After filing your federal tax return, the IRS matches the income and payments on your Form 1099-G against the agency-reported information. If the reported totals align, your return processes normally, and you’ll receive your refund or confirmation of payment. If there’s a mismatch, you may receive a notice requesting verification or repayment of taxes owed. Always keep your tax records and communication from the Internal Revenue Service for future reference. If identity theft or unemployment fraud occurs, contact both the IRS and your state agency promptly.
FAQs
What is the 1099-G tax form used for during the 2012 tax year?
The 1099-G tax form reports government payments such as unemployment benefits, taxable grants, or income tax refunds received during the 2012 tax year.
How do I report income from unemployment compensation on my federal tax return?
Include your unemployment compensation listed on Form 1099-G as taxable income on your federal income tax return for the same calendar year.
What should I do if I suspect unemployment fraud or identity theft involving my Form 1099-G?
Immediately report fraud to your state labor department and the IRS. The agency can correct your tax information and issue an updated form showing accurate payments.
When should I expect to receive my 1099-G form for 2012 government payments?
You should have received your 1099-G form by mail or electronic access by January 31, 2013. If not, contact the issuing state agency for assistance.
How can I determine whether my state income tax refund is considered taxable income?
Your refund is only taxable if you itemized deductions and claimed a deduction for state income taxes on your prior federal return.
What should I do if I receive corrected information after I already filed my return?
If your state agency sends an updated form with corrected information, file an amended return using the easiest and fastest way available through IRS e-file or paper filing.
What records should I keep after filing my 2012 income tax return?
Keep all forms, records, and notices for a minimum of three years. These documents protect you in case the IRS questions your income, deductions, or payments.
