Source: Michigan Department of Labor and Economic Opportunity
Unemployment benefits are taxable and must be reported on federal and state tax returns.
The statements, called 1099-G or “Certain Government Payments,” are prepared by UIA and report how much individuals received in unemployment benefits and income tax withheld last year. Copies of the 1099-G forms are also sent to the IRS and the Michigan Department of Treasury.
If you have received a Form 1099-G and you have not filed for or collected unemployment benefits in 2020, you may be a victim of identity theft. Michigan Unemployment Insurance Agency (UIA), like other unemployment agencies across the country, have been attacked by criminals who attempt to use stolen identities to file fraudulent unemployment claims.
The 1099-G form is used to report taxable benefits when filing with the IRS. Every year, we send a 1099-G to people who received unemployment benefits. We also send this information to the IRS.
When criminals fraudulently claim benefits in someone else’s name, we must investigate and confirm fraud before we can update the IRS.
1099-G INFO FOR IDENTITY THEFT VICTIMS
Q – I did not file for or collect unemployment benefits. Why did I receive a Form 1099-G from UIA?
A – If you have received a Form 1099-G and you have not filed for or collected unemployment benefits in 2020, you may be a victim of identity theft.
Q – What should I do if I am a victim of identity theft, and received a 1099-G notice?
A – Report it to the UIA at michigan.gov/uia. Click on “Report Identity Theft” and include as much detail as possible. Also, submit a completed version of Form UIA 6349, Statement of Identity Theft, with your report.
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- UIA will investigate your report regarding identity theft. Once identity theft is confirmed, UIA will issue a corrected 1099-G to you and the Internal Revenue Service (IRS).
- Please be patient. The rampant imposter fraud and identity theft across the country requires that UIA individually review each claim of suspected fraud. If you have already provided information to the UIA, there is no need to resubmit information unless asked by UIA.
Q – I already reported that my identity was stolen and used to file a Michigan unemployment claim. Why did I still receive a 1099-G?
A – We are working as quickly as we can to process a record number of fraudulent unemployment claims. Each claim of suspected fraud must be reviewed individually. There is no need to resubmit information unless asked by UIA.
GENERAL 1099-G QUESTIONS
Q – Will I be responsible for paying taxes on benefits I never received?
A – If you did not apply for unemployment benefits in 2020 but received a 1099-G, you will not be responsible for paying taxes on that income after the UIA has confirmed that the claim filed was fraudulent. Be sure to report the fraud at Michigan.gov/uia in order to obtain a corrected 1099G.
Once identity theft is confirmed, UIA will issue a corrected 1099-G to you and the Internal Revenue Service (IRS).
IRS guidance says that taxpayers who are unable to obtain a timely, corrected 1099-G from states should still file an accurate tax return, reporting only the income they received. A corrected Form 1099-G showing zero unemployment benefits in cases of identity theft will help taxpayers avoid being hit with an unexpected federal tax bill for unreported income.
Visit the IRS website for a taxpayer guide to identity theft and info about how and when individuals should file 2020 taxes. Information on tax related identity theft is also available from the Michigan Department of Treasury.
Q – Why is my overpayment, which I repaid, not reported on my Form 1099-G?
A – Please refer to the back of your 1099-G RE: Restitution, Penalties and Interest – Monies repaid to the UIA during tax year 2020 are not deducted from the amount shown in Box 1. Refer to your federal 1040 instruction booklet for further information.
Q – What if my 1099-G has an incorrect amount in “total payment” or tax withheld” areas of the form?
A – Complete Form UIA 1920, Request to Correct Form 1099-G, and submit it to UIA. This form can be found at michigan.gov/uia. Click on Forms for Workers. Mail completed forms to: Unemployment Insurance Agency, 1099-G, P.O. Box 169, Grand Rapids, MI 49501-0169.
Q – Are PUC and LWA amounts included in the 1099G?
A – Yes. Your 1099-G will include a combined total of benefits paid on any program a claimant was on including UI, PEUC, EB, PUA, TRA or DUA. This will also include additional amounts such as Pandemic Unemployment Compensation (PUC) and Lost Wages Assistance (LWA).
Q – How can I get a duplicate 1099-G?
A – You can download a duplicate 1099-G from your MiWAM account. In your MiWAM account under “I Want To” click on the 1099-G link, or call UIA customer service at 866-500-0017.
Q – Why does MiWAM show that money was withheld for taxes, but the 1099-G shows $0 was taken out?
A – Withholding taxes have been submitted to the IRS only for the weeks you were entitled to benefits. If you received payment for any weeks during 2020, and was later held ineligible for those weeks, all tax payments associated with that week were reversed, meaning those taxes are not reportable on the 1099-G.
Claimants who have weeks where the benefit payment was stopped in the manager review process, the withholding will be retained and reported in the year the benefit payment for that week was released.
Q – I paid back part or all of the amount reported on my 1099-G, Box 2. How do I get a corrected form?
A – Please refer to the back of your 1099-G RE: Restitution, Penalties and Interest – Monies repaid to the UIA during tax year 2020 are not deducted from the amount shown in Box 1. Refer to your federal 1040 instruction booklet for further information. IRS Pub 17, Tax Guide 2020 (page 70 – Unemployment Benefits) provides instructions to filers on how to report the repayment of unemployment compensation.
1099-G AND WORK SHARE
Q – I’m a Work Share claimant – My address has changed, and I didn’t receive my 1099-G. How do I get one if I don’t have a MiWAM account?
A – Update your address by calling UIA customer service at 1-866-500-0017 or mail completed Form UIA 1925, Request for Name/Address Change to UIA, P.O. Box 169, Grand Rapids, MI 49501-0169. You will need to contact UIA to request a 1099-G.
Large enough to serve a diverse clientele, yet small enough to maintain a hands-on approach, we are committed to maintaining the highest accounting and ethical standards with continuous education, extensive research resources, and excellent quality control.
Polk and Associates is a member of the Michigan Association of Certified Public Accountants, and the American Institute of Certified Public Accountants. The firm participates in the AICPA Peer Review Program, and has always received the highest level of award for its audit practice and quality control.
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