National Insurance and Tax Service

What You Need to Know About Unemployment Form 1099-G

Certain Government Payments

Reporting the unemployment compensation comes under the primarily uses of the 1099-G Form. It also covers reporting the income tax refunds of a specific state. It is compulsory to report the information that the 1099-G Form requires about the tax return on receiving the Form for the current year. for this purpose, you may receive a 1099-G form from the federal, state or a local government agency.

What is unemployment form 1099-G?

1099 Form
What You Need to Know About Unemployment Form 1099-G

A 1099-G Form refers to the complete record of taxable income including the unemployment compensation. The authority that pays local or state income taxes of $10 or above needs to send this Form to you. It contains the most important data used for completing the tax return once you receive it.

Tax software can also be used for calculating the taxable income you owe. The unemployment payment is reported to the IRS as an income. You need to report the entire amount on the federal tax upon receiving the payment of Unemployment Insurance (UI) the previous year. However, including the 1099-G Form in the federal income tax return is not mandatory. The payment’s issue date is based upon which the benefits are reported.

What Form 1099-G is used for?

All the people who received UI benefits should obtain the form 1099-G. The total paid benefits in a calendar year are reported to the IRS. Form 1099-G is used for completing the tax returns of federal or a particular state on receiving the employment benefits. Additionally, it shows the information of local or state income tax credits that are sent to you in box #2. It is issued from the side of the Federal Government on receiving the payment on a commodity credit corporation loan.

If a federal or local government pays out taxable credits or offsets, it must file a 1099-G Form. The Form mentions all the important information regarding the taxes, benefits, and payments. Its copy is also sent to the IRS during the process of its filing by a local or federal government. So, a total of 5 copies of the forms are prepared to be distributed. However, the Form is only processed for those individuals who have received UI funds. So, if you did not receive these benefits and still got the Form, it indicates a fraudulent claim.

What is in Unemployment Form 1099-G?

The complete recipient and the payer details are included on the left side of the Form. These details include account number, address, or name. The Form contains many boxes on its right side. Among these, the major ones include State Income Tax withheld, State Identification Number, Market Gain, Agriculture Payment, Taxable Grants, RTAA payments, Federal Income Tax Withheld, and Unemployment Compensation.

For example, box 1, namely unemployment compensation, refers to a complete unemployment compensation report sent to you in the current year. 

Box 2 contains the same information that is mentioned earlier, and the amount becomes taxable upon deducting the local or state income tax. Offsets, credits, and refunds are made in box 2 for a specific year. 

Box 3 contains information about that year. You can read all the information on Form 1099-G on website of Government of Illinois.

How to Access Form 1099-G in Illinois?

You will receive the Form1099-G from the Illinois government either through mail or an email. IDES mails the paper copies of the Form to those individuals who don’t want to get the Form electronically. IDES sends these copies in January. It is also possible for the claimants to access Form 1099-G through Tele-serve. On 31st January, the filing agency sends a copy of the Illinois unemployment Tax Form to the target persons.

The unemployment compensation offsets, credits, and state income tax refunds become the reason why you receive the 1099-G Illinois form. The filing agency sends the Form after the tax year. You can also get access to the 1099-G from your home. This can be done by going through the Illinois unemployment benefits website. The Form will be available to you if you have been receiving unemployment compensation.

Frauds on unemployment Form 1099-G

Scam Calling

Many frauds on the unemployment form 1099-G have been reported. You may receive the Form even you didn’t receive any unemployment compensation. This can be a scenario of unemployment identity theft

It means you can receive the Form for unemployment compensation that is not sent to you. This indicates that you have become a victim of identity theft. In such a case, you need to contact the issuer of Form 1099-G.

It is important to show that you didn’t receive any benefit for the current year. You can also go for filing the complete return. You simultaneously need to report the received income. In such a scenario, it is mandatory to monitor the revenue platform of your state department. It will help in checking the additional instructions shown by a state. For Illinois State, you can read more information about how to report the unemployment identity theft

How to know you have been tricked?

Filing a fraudulent claim requires the identity of another person. The scammers tend to use the victims’ contact details, including address, name, and other personal details. You will receive the Form 1099-G through the mail that has your name on it. You can see on it the benefits of unemployment that you didn’t get for a specific year.

You need to contact the issuance agency without any delay. It is better not to report the unemployment benefits as income without double-checking. The reason is that these benefits may not refer to a correct claim that you have filed. The amount reported on the Form should be double-checked to confirm that you have received the specified benefit for a specific year.

Wrap up

The Form 1099-G is issued when you receive certain Government payments such as agricultural payments, taxable grants, local income tax refunds, or unemployment compensation. It is sent through your desired method (email or mail) of correspondence. The Form is mainly used for reporting the total taxable income issued in a specific year. You will be issued the Form on receiving unemployment benefits of above $10. In a nutshell, you can obtain a complete record of taxable unemployment benefits through Form 1099-G. In case you are seeking help with your 1099-G Form, our Tax advisors at myNITS are available to help you out. 

Leave a comment

Your email address will not be published. Required fields are marked *