Form 1099-G: Certain Government Payments (2017) – Complete Guide

If you received unemployment benefits, a state tax refund, or certain other government payments in 2017, you likely got Form 1099-G. It tells you and the IRS about payments you received—some of which may be taxable.

What the form reports (2017)

• Box 1 – Unemployment compensation. Generally fully taxable at the federal level.
• Box 2 – State/local income tax refund, credit, or offset. Taxable only if you itemized deductions for the related year and got a tax benefit from deducting state income tax.
• Box 3 – Year the refund applies to. Blank usually means the immediately prior year.
• Box 4 – Federal income tax withheld. Voluntary withholding (e.g., 10% on unemployment if you filed Form W-4V).
• Box 5 – ATAA/RTAA payments. (Workers affected by foreign trade), $600+ threshold.
• Box 6 – Taxable grants. $600+ threshold; report based on the grant’s nature.
• Box 7 – Agriculture payments. Reported by farmers on Schedule F (or by entities on their forms).

Issuance thresholds (2017):

• Unemployment and state/local refunds: $10+
• ATAA/RTAA, taxable grants, agriculture payments: $600+

Government agencies had to furnish Copy B by Jan 31, 2018 and file with the IRS by Feb 28, 2018 (paper) or Apr 2, 2018 (e-file).

What you do with it (including late/amended situations)

1. Match to your records. Check your name/SSN and amounts. If wrong, ask the issuer for a CORRECTED form.
2. Didn’t receive it? You must still report taxable income. Retrieve it from the agency (many offer online portals) or use your payment records.
3. Already filed and then received/corrected a 1099-G? File Form 1040X to amend.

Exactly where it goes on the 2017 Form 1040

• Unemployment (Box 1): Line 19 (“Unemployment compensation”).
• Taxable state/local refund (Box 2): Line 10 (“Taxable refunds, credits, or offsets of state and local income taxes”). (Only if you itemized on your 2016 return (or the year shown in Box 3) and got a benefit.)
• Federal withholding (Box 4): Line 64 (“Federal income tax withheld from Forms W-2 and 1099”).
• ATAA/RTAA (Box 5) & Taxable grants (Box 6): Line 21 (“Other income”) unless clearly business/farm-related.
• Agriculture payments (Box 7): Schedule F (or the appropriate business/entity form).

Tip: If your refund in Box 2 relates to 2016 and you took the standard deduction for 2016 (i.e., no Schedule A), it’s not taxable in 2017.

Step-by-step (quick)

1. Collect all 1099-G forms (multiple states/programs = multiple forms).
2. Verify taxability:
   • Box 1: taxable.
   • Box 2: taxable only if you itemized (and benefited) for the year in Box 3.
3. Enter on the correct lines (see mapping above).
4. Include Box 4 withholding with your total withholding.
5. Keep everything at least 3 years (7 is safer).

Common mistakes (and easy fixes)

• Reporting Box 2 when you took the standard deduction. Don’t. (No prior-year itemizing = usually not taxable.)
• Forgetting Box 4 withholding. Add it to total withholding on Line 64.
• Omitting unemployment income. Box 1 is fully taxable—the IRS will match it.
• Using 2018+ line mapping. Schedule 1 didn’t exist in 2017. Use the 2017 1040 line references above.
• Multiple 1099-Gs, but reporting only one. Add all applicable boxes across all forms.
• Repayments not reflected. If you repaid benefits in 2017, request a corrected form. If repaid in a later year, you may need a deduction/credit under the claim-of-right rules (see Pub. 525).

After you file

• The IRS matches each 1099-G to your return months later.
• If something’s missing or mismatched, expect a CP2000 proposing additional tax/interest. You can agree or respond with documentation.
• If you later receive a corrected 1099-G, file Form 1040X for 2017.

Quick FAQs

Do I report unemployment if I never got the form? Yes—report it using your records; also request the form from the agency.
How do I know if my state refund is taxable? Check if you itemized for the year in Box 3 and deducted state income tax (Schedule A). If not, it’s typically not taxable.
Can I withhold tax from unemployment? Yes—submit Form W-4V to withhold (commonly 10%). It will show in Box 4.
Grants/ag payments—where do they go? Usually Line 21 (grants) or Schedule F (farm). Depends on the activity’s nature.

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