What Form 1099-G Is For
Form 1099-G (2019) reports certain government payments such as unemployment compensation, state tax refunds, and taxable grants. Federal, state, and local government agencies issue this tax form to individuals who received benefits or refunds during the calendar year. It assists both taxpayers and the Internal Revenue Service in accurately reporting all taxable income on a federal income tax return. You don’t file this form yourself; you use it to complete your tax return accurately.
When You’d Use Form 1099-G
You use Form 1099-G when filing your 2019 federal tax return or when amending a past due return that includes unemployment benefits or other government payments. Most people received their 1099-G by January 31, 2020, from a state government or agency. If you file late or get a corrected form, you must still report the total amount shown. Filing accurately prevents penalties or IRS notices.
Key Rules or Details for 2019
- Unemployment compensation is taxable income: Unemployment benefits paid in 2019 are considered taxable income and must be included on your federal income tax return. You should also report unemployment insurance benefits even if federal income taxes were withheld.
- State tax refunds may be taxable: Income tax refunds are only taxable if you itemized deductions in the previous tax year and received a benefit from deducting state income taxes.
- Reporting thresholds apply: You should receive a Form 1099-G if you received $10 or more in state tax refunds or $600 or more in other government payments, such as taxable grants.
- Federal withholding credits reduce taxes owed: Any state tax deducted or federal tax withheld appears on your 1099-G and counts as a credit on your federal return.
- Market gains and agricultural payments must be reported: Certain payments from government programs, including farm subsidies, are also considered taxable and must be included in your federal taxable income.
Browse more tax form instructions and filing guides in our Forms Hub.
Step-by-Step (High Level)
Step 1: Verify your information
Confirm that your name, address, and Social Security number are correct. Check the form carefully for errors in the total amount paid, tax withheld, or refund shown. If incorrect, contact the issuing labor or tax agency immediately to request an updated form.
Step 2: Determine what’s taxable
Identify which payments are taxable unemployment compensation or taxable grants. Review your previous tax return to determine whether you took itemized deductions. This helps decide if your state refund is taxable on your current federal income tax return.
Step 3: Report income on your tax return
Include all taxable amounts from your Form 1099-G on your federal income tax return. Enter unemployment benefits under the unemployment compensation section and state refunds under income. If federal income tax was withheld, report it as a credit toward your total tax owed.
Step 4: Claim withholding credits
The easiest and fastest way to reduce your tax bill is to claim federal income taxes withheld as shown on the 1099-G. Federal taxes withheld on unemployment payments appear in Box 4 and directly lower your balance due.
Step 5: Keep your paper copy
Keep your paper copy of the 1099-G for at least three years with your tax records. You don’t mail it with your federal return since the IRS already receives it electronically from the issuing agency. Retaining this tax information is helpful if you need to correct an overpayment, file an amended claim, or report fraud later.
Learn more about federal tax filing through our IRS Form Help Center.
Common Mistakes and How to Avoid Them
- Not reporting unemployment benefits: Some taxpayers forget to report unemployment insurance benefits. To avoid penalties, include all unemployment income and any federal income tax withheld on your return.
- Reporting non-taxable refunds: Many taxpayers report state tax refunds even when they used the standard deduction. Review your 2018 deductions before filing to determine whether your refund is taxable.
- Using the wrong tax year: Always confirm the tax year listed on your form. Report only 2019 payments on your 2019 federal tax return to prevent confusion or overpayment.
- Forgetting withholding credits: Failing to claim credits for federal taxes withheld increases your bill unnecessarily. Double-check your 1099-G boxes before finalizing your return.
- Ignoring identity theft or unemployment fraud: If your 1099-G lists benefits you didn’t receive, you may be a victim of unemployment fraud. Contact your state labor department immediately to request a corrected form and report fraud.
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 you file your federal income tax return, the IRS matches your reported income to the Form 1099-G information provided by government agencies. If everything matches, your refund or bill process will proceed normally. If not, you may receive a CP2000 notice proposing corrections. Maintaining accurate records, claiming all applicable credits, and promptly addressing any discrepancies ensures smooth processing and prevents penalties.
FAQs
How do I report unemployment benefits on my 1099-G form?
You must include all unemployment benefits listed on your 1099-G form as taxable unemployment compensation. Enter the total on your federal tax return under unemployment income to ensure accurate reporting.
What if my state tax refund is listed on Form 1099-G?
State tax refunds are taxable only if you claimed itemized deductions the previous year. Review your tax return and determine if your state refund should be added to taxable income.
How do I correct errors or report fraud on my 1099-G tax form?
If you find incorrect information or suspect unemployment fraud, contact your state government agency or labor department immediately. They can issue a corrected 1099-G and guide you on how to report fraud and protect your identity.
Can I file my 1099-G form with my other tax information?
You don’t file the 1099-G yourself with your tax return. Instead, use the tax information on it to complete your federal return. Keep your paper copy in case the IRS requests verification later.
What should I do if I were a victim of identity theft involving unemployment benefits?
If you receive a 1099-G showing benefits you never claimed, contact your state labor office and the IRS right away. Reporting identity theft quickly helps correct records and prevents tax penalties or overpayment.
When will I receive my 1099-G form for government payments?
Government agencies typically mail or provide electronic access to Form 1099-G by January 31 of the year following the tax year. Visit your state’s tax website if you haven’t received it by early February.
How can I access a copy of my 1099-G tax form if I lost it?
You can request a replacement from the government agency that issued the payments. Most state tax departments offer online access to past forms, making it the easiest and fastest way to obtain a copy.
