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What is a 1099-G form?
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What is a 1099-G form?
Another day, another 1099 form. The 1099-G form (Certain Government Payments) is an informational IRS form that shows you any money you’ve received from the government. This is quite different from a form like the 1099-NEC, which reports self-employed income.
When it comes time to file your taxes, you'll need this form since the money you received might need to be reported on your Form 1040. Unlike a 1099-MISC which reports your miscellaneous income and is essential when paying self-employment tax, Form 1099-G only affects your federal and state income taxes.
Key takeaways:
- Form 1099-G reports money received from the government in the form of refunds or unemployment
- Certain types of payment need to be reported on Form 1040
- This form is different from other self-employment related 1099 forms like the 1099-K
Table of contents
Who receives Form 1099-G?
If you receive a 1099-G form, it probably means that you've got some money from the government coming your way. This can be in the form of a local or state tax refund if you’ve overpaid your taxes or any unemployment compensation you received in a year.
You could also receive this form if you've gotten any grants that are subject to tax. Another more uncommon use is the Commodity Credit Corporation (CCC) loan payments, mainly used by the agricultural sector.
Form 1099-G also includes any Reemployment Trade Adjustment Assistance (RTAA) payments received. Under the RTAA, skilled workers aged 50 and above who qualify for Trade Adjustment Assistance (TAA) and secure new employment can receive a wage subsidy. This subsidy is specifically designed to bridge the gap between their previous job's salary and their new role's earnings to encourage workers to transition back into the workforce.
Like most forms, you'll receive this form by the end of January. If you don't receive it, it's always a good idea to contact the concerned company or institution. If you only need it to view your total unemployment compensation, you can access the form online on your state’s website.
Quick tip
If you're struggling with your self-employment taxes, a 1099 tax calculator can be a useful starting point.
What's on Form 1099-G?
Now, what exactly is in a 1099-G form? On one side, there's the recipient and sender's tax information. The other side has 11 boxes with all the different payment types you can receive and their corresponding amounts.
It is also important to stress that 1099-G forms can differ based on the state that sends it. So, not all the boxes may be in every type of 1099-G form.
How do I file Form 1099-G?
Anyone receiving the 1099-G form doesn't actually have to file it since it's done by the institution or entity that sent the form. There are some instances though where you'll need to report these payments as income.
If you received any unemployment compensation, you'll need to report that on Schedule 1 (Form 1040) in the “Additional Income” section. Even if you received multiple 1099-G forms, just total the amounts from box 1 and report it.
When it comes to state tax refunds, it really depends on the state you live in. If you live in a state where your employer withholds your taxes, you can deduct that tax liability if you itemize your deductions instead of claiming the standard deduction. You can use a California tax calculator to check this if you live in California.
Most of the time, your employer will withhold more taxes than you owe, so you'll get a tax refund. But if you claim the itemized deduction for that tax year, that tax refund becomes taxable in the next year, and you'll have to report it as income.
Let's use an example to break this down. Suppose your employer withheld $4,000 from your salary in 2024 for state taxes. When preparing and filing your return for 2024, you realized that you only owed the state $3,000. So, you got a $1,000 refund and a Form 1099-G reporting the payment.
But, you itemized your deductions on Schedule A when you filed and had already deducted the $4,000 that was withheld from your income as a tax write-off. So, you’ll need to report that $1,000 refund as income when you file in 2024.
Sometimes, you may have gotten a refund for a self-employed business you run. In this case, box 8 of the 1099-G form will have a checkmark in it. In this case, you'll report this refund as income on Schedule C.
You can get away with not reporting your refund if you didn't benefit from it or claimed the standard deduction in the year you were owed it. So, if you claimed the standard deduction in 2024 and got the refund in 2024, you wouldn’t have to report it when you filed your 2024 tax return.
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