What Is Form 1099-G: Certain Government Payments?

What Is Form 1099-G: Certain Government Payments?

Form 1099-G, Certain Government Payments is a form filed by federal, state, and local government agencies for payments made to taxpayers. The form is sent to the Internal Revenue Service (IRS) and to taxpayers to report payments such as unemployment compensation as well as payments made on a Commodity Credit Corporation (CCC) loan. Forms are sent to taxpayers by the end of January of the year following the payments.

Who Can File Form 1099-G?

Form 1099-G, Certain Government Payments is filed by various levels of government—federal, state, and local. They must be filed whenever those governments made payments for:

• Unemployment compensation
• Income tax refunds, credits, or offsets at the state and local levels
• Reemployment trade adjustment assistance (RTAA)
• Taxable grants
• Agricultural payments

Federal, state, or local governments should file Form 1099-G to report if they received payments on a Commodity Credit Corporation (CCC) loan.

Five copies of the 1099-G must be completed. The IRS receives Copy A, the state tax department gets Copy 1, and the taxpayer gets Copy B. Copy 2 goes to the taxpayer to file with their state income tax return if required, while Copy C goes to the payer or filing agency.

How to File Form 1099-G

Form 1099-G is sent to you if a federal, state, or local government made payments to you. The most common uses of the 1099-G are to report unemployment compensation and state and local income tax refunds. If you receive a 1099-G, you may need to report some of the information when you file your income tax return. This information is included as part of your income on Form 1040.

You should receive your Form 1099-G by January 31 of the year following the tax year. You may also access the form online if you received unemployment compensation by visiting your state’s unemployment benefits website.

The left side of the form includes details about the payer (the government that made the payment) and the recipient (you, the taxpayer), including names, addresses, tax identification numbers (TINs), and any associated account number. The right side of the form has 11 boxes.

• Box 1: Unemployment compensation. This box is reserved for total unemployment compensation (including Railroad Retirement Board payments) received this year. If you receive more than one 1099-G, combine the amounts in Box 1 and report the total as income on the unemployment compensation line of your tax return.
• Box 2: State or local income tax refunds, credits, or offsets. Box 2 shows refunds, credits, or offsets of state or local income tax you received. This amount might be taxable if you deduct the state or local income tax paid on Schedule A.
• Box 3: Box 2 amount is for the tax year. Box 3 shows the tax year for which the refunds, credits, or offsets in Box 2 were made. The box may be left blank if the refund, credit, or offset is for the current tax year.
• Box 4: Federal income tax withheld. Box 4 shows backup withholding or withholding you requested on unemployment compensation, Commodity Credit Corporation (CCC) loans, or certain crop disaster payments.
• Box 5: RTAA payments. Box 5 shows the reemployment trade adjustment assistance (RTAA) payments you received. This amount should be included in the "other income" line of Schedule 1.
• Box 6: Taxable grants. Box 6 shows taxable grants you received from government agencies.
• Box 7: Agriculture payments. Box 7 shows taxable payments you received from the U.S. Department of Agriculture (USDA). See IRS Pub. 225 and the Schedule F instructions to learn where to report this income.
• Box 8: Check if Box 2 is trade or business income. Box 8 shows if the amount in Box 2 is related to an income tax that applies exclusively to income from a trade or business. If taxable, report the amount from Box 2 on Schedule C or F.
• Box 9: Market gain. Box 9 shows any market gain associated with the repayment of a Commodity Credit Corporation (CCC) loan (available only to farmers).
• Box 10a: State. Box 10a displays the abbreviated name of the state.
• Box 10b: State identification no. Box 10b shows the state’s identification number.
• Box 11: State income tax withheld. Box 11 shows the amount of state income tax withheld.

All copies of Form 1099-G are available on the IRS website.

The Bottom Line

Form 1099-G, Certain Government Payments, is used for payments made by government agencies to taxpayers. These payments may include unemployment, tax refunds, and taxable grants, among other types of payments. You must report these payments to the IRS on Form 1099-G.