Who Sends Form 1099-G and Why
Form 1099-G, officially titled “Certain Government Payments,” is an IRS information return issued by federal, state, or local government agencies. An information return is a form that reports a payment to both you and the IRS. It’s one of several types of 1099 forms the IRS uses to track income.
Because the IRS gets the same numbers you do, what you report should match your form. You may also receive more than one 1099-G in a year, such as one for unemployment and another for a state tax refund.
What Each Box on Form 1099-G Means
Each box reports a different type of payment or detail. This table follows the Form 1099-G instructions for 2026 information filed in early 2027.
| Box | What it reports |
|---|---|
| 1 | Unemployment compensation of $10 or more, including Railroad Retirement Board unemployment |
| 2 | State or local income tax refunds, credits, or offsets of $10 or more |
| 3 | The tax year the Box 2 amount is for |
| 4 | Federal income tax withheld (backup or voluntary withholding) |
| 5 | Reemployment Trade Adjustment Assistance (RTAA) payments |
| 6 | Taxable grants |
| 7 | Agriculture payments |
| 8 | Checkbox for trade or business income |
| 9 | Market gain |
| 10 | Family leave benefits from state paid family and medical leave programs (a new box) |
| 11a–12 | State information |
Box 4 shows any withholding, which is federal income tax taken out of a payment before you get it and sent to the IRS for you. The sections below cover Box 1 and Box 2 in more detail.
How to Handle the Most Common 1099-G Amounts
Unemployment Compensation in Box 1
Unemployment benefits are taxable as ordinary income, meaning they’re taxed like wages. Withholding on these benefits is optional, so you may owe tax when you file if none was taken out.
Here’s where the amounts go, based on IRS Topic No. 418:
- Report the Box 1 amount on line 7 of Schedule 1 (Form 1040).
- Include any Box 4 withholding on line 25b of Form 1040 or 1040-SR. This is where you report all your income tax payments and withholding from various sources—wages, unemployment benefits, and others.
State or Local Tax Refund in Box 2
Whether a state refund is taxable depends on how you handled deductions for the year the refund covers (not the current year you’re filing), shown in Box 3. To itemize means listing your individual deductions, such as state income taxes paid, instead of taking the standard deduction (a set amount based on your filing status that the IRS provides automatically).
- If you took the standard deduction in the year the refund covers, none of the refund is taxable income.
- If you itemized that year and deducted state income taxes paid, some or all of the refund may be taxable.
To figure the taxable part, IRS Publication 525 points you to the State and Local Income Tax Refund Worksheet in the Form 1040 instructions.
What to Do if Your 1099-G Is Missing or Wrong
You must report government payments you received even if your 1099-G never arrives. Use your own records, like benefit statements or deposits, to find the amounts.
A 1099-G for unemployment benefits you never received may signal unemployment fraud, which is a common form of identity theft. If you receive a 1099-G you don’t recognize, act quickly: notify the state agency that issued the form and request a corrected 1099-G. You can also report the fraud to the Department of Labor.
