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Federal Form 1099-G - Certain Government Payments Instructions
Truncating recipient's identification number on paper payee statements. Notice 2011-38 allows all filers of this form to truncate a recipient's identification number (social security number (SSN), individual taxpayer identification number (ITIN), or adoption taxpayer identification number (ATIN)) on paper payee statements for tax years 2011 and 2012. See part M in the 2012 General Instructions for Certain Information Returns.
General Instructions. In addition to these specific instructions, you should also use the 2012 General Instructions for Certain Information Returns. Those general instructions include information about the following topics.
- Backup withholding.
- Electronic reporting requirements.
- Who must file (nominee/middleman).
- When and where to file.
- Taxpayer identification numbers.
- Statements to recipients.
- Corrected and void returns.
- Other general topics.
You can get the general instructions from IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676).
How to get the latest information. If there are changes to the 2012 tax law that affect Form 1099-G, you will be able to find them at www.irs.gov/form1099g.
File Form 1099-G, Certain Government Payments, if, as a unit of a federal, state, or local government, you made payments of unemployment compensation; state or local income tax refunds, credits, or offsets; alternative trade adjustment assistance (ATAA) payments; reemployment trade adjustment assistance (RTAA) payments; taxable grants; or agricultural payments. You must also file this form if you received payments on a Commodity Credit Corporation (CCC) loan. The officer or employee of the government unit having control of the payments, received or made, (or the designated officer or employee) must file Form 1099-G.
Statements to Recipients
If you are required to file Form 1099-G, you must provide the same information to the recipient. Furnish a copy of Form 1099-G or an acceptable substitute statement to each recipient, except as explained later under Box 2. State or Local Income Tax Refunds, Credits, or Offsets. Also, see part M in the 2012 General Instructions for Certain Information Returns.
The account number is required if you have multiple accounts for a recipient for whom you are filing more than one Form 1099-G. Additionally, the IRS encourages you to designate an account number for all Forms 1099-G that you file. See part L in the 2012 General Instructions for Certain Information Returns.
Box 1. Unemployment Compensation
Enter payments of $10 or more in unemployment compensation including Railroad Retirement Board payments for unemployment. If you make payments from a contributory program that has been deemed to be in the nature of unemployment compensation, such as California's Family Temporary Disability Insurance payments or governmental paid family leave program payments, file a separate Form 1099-G for payments from each contributory program. Enter the total amount before any income tax was withheld. If you withhold federal income tax at the request of the recipient, enter it in box 4.
Box 2. State or Local Income Tax Refunds, Credits, or Offsets
Enter refunds, credits, or offsets of state or local income tax of $10 or more you made to recipients. If recipients deducted the tax paid to a state or local government on their federal income tax returns, any refunds, credits, or offsets may be taxable to them. You are not required to furnish a copy of Form 1099-G or a substitute statement to the recipient if you can determine that the recipient did not claim itemized deductions on the recipient's federal income tax return for the tax year giving rise to the refund, credit, or offset. However, you must file Form 1099-G with the IRS in all cases.
A tax on dividends, a tax on net gains from the sale or exchange of a capital asset, and a tax on the 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 $10 or more of these taxes is reportable on Form 1099-G. In the case of the dividends tax and the capital gains tax, if you determine that the recipient did not itemize deductions, as explained above, you are not required to furnish a Form 1099-G or substitute statement to the recipient. However, in the case of the tax on unincorporated businesses, you must furnish a Form 1099-G or substitute statement to the recipient in all cases, as this is a tax that applies exclusively to income from a trade or business. See Box 8. Trade or Business Income (Checkbox) on page 2 and Rev. Rul. 86-140, 1986-2 C.B. 195.
If you pay interest of $600 or more on the refund, you must file Form 1099-INT, Interest Income, and furnish a statement to the recipient. For interest payments of less than $600, you may choose to enter the amount with an appropriate designation such as "Interest Income" in the blank box on Copy B of the Form 1099-G.
Box 3. Box 2 Amount Is For Tax Year
No entry is required in box 3 if the refund, credit, or offset is for the 2011 tax year. If it is for any other tax year, enter the year for which the refund, credit, or offset was made. Also, if the refunds, credits, or offsets are for more than 1 tax year, report the amount for each year on a separate Form 1099-G. Use the format "YYYY" to make the entry in this box. For example, enter 2010, not '10.
Box 4. Federal Income Tax Withheld
Backup withholding. Enter backup withholding at a 28% rate on payments required to be reported in box 6 or 7. For example, if a recipient does not furnish its taxpayer identification number (TIN) to you, you must backup withhold.
Voluntary withholding. Enter any voluntary federal withholding on unemployment compensation, CCC loans, and certain crop disaster payments. If you withheld state income tax see Box 10a through Box 11 later. However, you are not required to report state withholding to the IRS.
Box 5. ATAA/RTAA Payments
Enter ATAA payments of $600 or more that you paid to eligible individuals under the Demonstration Project for Alternative Trade Adjustment Assistance for Older Workers. Enter RTAA payments of $600 or more that you paid to eligible individuals under the Reemployment Trade Adjustment Assistance program. Report the combined total of payments made to the same individual under both programs on one Form 1099-G.
Box 6. Taxable Grants
Enter any amount of a taxable grant administered by a federal, state, or local program to provide subsidized energy financing or grants for projects designed to conserve or produce energy, but only with respect to energy property or a dwelling unit located in the United States. Also, enter any amount of a taxable grant administered by an Indian tribal government.
Report amounts of other taxable grants of $600 or more. A federal grant is ordinarily taxable unless stated otherwise in the legislation authorizing the grant. Do not report scholarship or fellowship grants. See Scholarships in the Instructions for Form 1099-MISC.
Box 7. Agriculture Payments
Enter USDA agricultural subsidy payments made during the year. If you are a nominee that received subsidy payments for another person, file Form 1099-G to report the actual owner of the payments and report the amount of the payments in box 7.
Box 8. Trade or Business Income (Checkbox)
If the amount in box 2 is a refund, credit, or offset attributable to an income tax that applies exclusively to income from a trade or business and is not a tax of general application, enter an "X" in this box.
Box 9. Market Gain
Report market gain associated with the repayment of a CCC loan whether repaid using cash or CCC certificates.
Box 10a. State
Enter the two letter postal abbreviation of the state for which state income taxes are being withheld.
Box 10b. State identification no.
Enter the identification number of the state department, division, or office identified in box 10a.
Box 11. State income tax withheld
Enter the amount of state income tax withheld from the payment reported in box 1.