1099-G is a common form used for certain types of government payments. The form has several purposes, but it is most often used to report two types of payment: state or local income tax refunds, credits, or offsets and unemployment compensation. Businesses worrying about this form will typically receive a copy for tax offsets, credits, and refunds.
The 1099-G form is one of the more common types of 1099s filed, but knowing how to do it can be tricky. Investing in 1099 form filing software is the best way to safeguard against making careless calculating and filing mistakes. Advanced Micro Solutions has a suite of tools to help, but first, we’ll run through some important information about Form 1099-G.
What to Know about 1099-G
Form 1099-G is deployed when the federal, state, or local government has made one or more of a specific payment. The types of payment included under the purview of this form are:
- Unemployment compensation
- State or local income tax refunds, offsets, or credits
- Taxable grants
- Agricultural payments
- Reemployment trade adjustment assistance (RTAA) payments
This form may also be filed if a person receives payments on a Commodity Credit Corporation (CCC) loan, but this is less common. As noted above, unemployment compensation and tax refunds, offsets, and credits are the most common uses for this form.
What Form 1099-G Means for You
All listed forms of government payments are subject to taxes. The amount of benefits will be shown in Box 1 of the 1099-G, but if the individual has chosen to have taxes withheld, that amount will appear in Box 4. The form itself is easy to navigate, requiring only personal information and easy calculous.
It may sound like only the government needs to deal with distributing 1099-G forms, but this is not the case. A tax on dividends, net gains from the sale or exchange of a capital asset, and net taxable income of an unincorporated business are taxes on gain or profit rather than on gross receipts. Therefore, they are income taxes, and any refund, credit, or offset of more than $10 must be reported on a 1099-G. As a result, you, a business owner, could receive one of these and be responsible for completing the document and furnishing copies to relevant parties.
1099-G Software Support
Form 1099-G is not as complicated as it might sound, but having a software tool in your back pocket can significantly alleviate the stress of tax season. Our W2 and 1099 Software platform will ensure you are ready for tax season, no matter what you may have to file.
What’s more, our W2 and 1099 filer includes support for all iterations of the 1099. Even if you’re unsure whether you’ll receive Form 1099-G this year, the software can help you distribute, calculate, and file every 1099 you might need. We also include a helpful 1099/W2 blog feed, which answers frequently asked questions and explains some more complicated aspects of 1099 filing. If you have any questions about this tool, call our Sales and Information team at 800-536-1099. If you’re still unsure if this is the product for you, we suggest browsing our Testimonials.