Form 1099-G is used to report a variety of government payments, including:
- Unemployment compensation (Box 1)
- State or local income tax refunds, credits, or offsets (Box 2)
- RTAA payments (Box 5)
- Taxable grants (Box 6)
- Agricultural payments (Box 7)
Unemployment Compensation (Box 1)
To enter Form 1099-G for unemployment compensation in the TaxAct program:
- From within the return, click Federal.
- On smaller devices, click in the upper left-hand corner, then choose Federal.
- Click Other Income, then click Unemployment compensation.
- Click + Add Form 1099-G Unemployment to create a new copy of the form or click Edit/Review to edit a form already created.
- Continue with the interview process to enter your information.
State or Local Income Tax Refunds (Box 2)
This amount is generally only taxable if you itemized deductions in the prior year.
To enter or review your state income tax refund in the TaxAct program:
- From within the return, click Federal.
- On smaller devices, click in the upper left-hand corner, then choose Federal.
- Click State Income Tax Refund.
- Click + Add Form 1099-G State Income Tax Refund or click Edit/Review to edit a form already created.
- Continue with the interview process to enter your information.
The program automatically uses the Form 1040 State Refund – State Refund Worksheet to determine the taxable amount based on the information entered for your prior year itemized deductions. If you did not itemize deductions last year, the refund is not taxable and will not be reported.
Federal tax withheld (Box 4)
Report Form 1099-G Box 4 in the unemployment compensation section:
- From within the return, click Federal.
- On smaller devices, click in the upper left-hand corner, then choose Federal.
- Click the Other Income drop down, then click Unemployment Compensation.
- Click + Add Form 1099-G Unemployment to create a new copy of the form or click Edit/Review to edit a form already created.
- Continue with the interview process until you reach the screen titled Enter the remaining details from the Form 1099-G for unemployment.
- Click the field below Box 4 - Federal tax withheld and type your Box 4 amount.
RTAA Payments (Box 5)
If you received RTAA payments and are required to report them as income, they must be reported as "Other income" on Schedule 1 (Form 1040), Additional Income and Adjustments to Income.
- From within the return, click Federal.
- On smaller devices, click in the upper left-hand corner, then choose Federal.
- Click Other Income to expand the section, then click Prizes, awards or other miscellaneous income.
- On the screen Miscellaneous - Amounts Received, enter the amount in the box from Form 1099-G, box 5 in the field Reemployment trade adjustment assistance.
Taxable Grants and/or Agricultural Payments (Box 6)
Entries on Form 1099-G Certain Government Payments, Box 6 (this covers certain government payments) are generally reported on IRS Schedule 1 (Form 1040) Additional Income and Adjustments to Income, Line 8. If the item relates to an activity for which you are required to file Schedule C, Schedule E, Schedule F, or Form 4835, you need to report the taxable amount allocable to the activity on that schedule or form instead.
To report Form 1099-G Box 6 on Schedule 1, Line 8 in the TaxAct program:
- From within the return, click Federal.
- On smaller devices, click in the upper left-hand corner, then choose Federal.
- Click the Other Income drop down, then click Prizes, awards or other miscellaneous income.
- On the screen titled Miscellaneous - Amounts Received, click the field below Description and type Form 1099-G, Box 6, then click the field below Amount and type the amount.
Agricultural Payments (Box 7)
Most government program payments are reported on Schedule F, Part I. This includes government payments, conservation program payments, indemnity payments for livestock killed by a natural disaster, cost-sharing payments, and forage disaster payments (cash, materials, services, etc.).
If a government payment is paid and then you later return all or part of the payment (such as a check returned, or an offset loan), the full amount is still reported on Schedule F, Part I. You would then take a deduction for the returned amount on Schedule F, Part II for the year in which the repayment occurs.
To access Schedule F data entry, go to Federal > Business Income > Farming income or loss.
Notices
If you received an IRS notice related to Form 1099-G, it may be due to one of the following common entry errors:
- A Form 1099-G was not entered in the TaxAct program and the income was not reported elsewhere in the return.
- An amount was transposed or omitted (e.g. $12,123 was entered instead of $21,123).
- Unemployment compensation was reported, but the user entered the amount in the "Unemployment Repaid" field instead, which lowered the taxable amount.
- The taxpayer received a state or local income tax refund and:
- selected "Did Not Itemize Last Year" when they did itemize, or
- entered incorrect amounts for the prior year Schedule A deductions, which reduced the taxable portion of the refund.