Guidance for Taxpayers on Unemployment Benefit-Related Identity Theft
Taxpayers Must Contact Their State Workforce Agency for Corrected Information
Fraudulent claims for unemployment benefits skyrocketed in 2020 during the COVID-19 pandemic. As a result, many U.S. taxpayers will receive Forms 1099-G for unemployment benefits they didn’t actually receive.
Scammers filed fraudulent unemployment claims using stolen personal information to receive benefits and compensation. This means some funds were paid to these scammers while many individuals received no benefits.
The IRS issued guidance urging taxpayers who receive Forms 1099-G for unemployment benefits in error to contact their appropriate state agency. As tax-filing season rolls around this year, remain vigilant. If you receive a Form 1099-G but didn’t apply for unemployment benefits, contact your state agency using the details below.
If you are unable to receive an updated 1099-G from your state agency by the time you file your tax return, you should still report the income and show an adjustment to your return for income not received. Even if you receive the updated Form 1099-G after April 15, 2021, this documentation will be needed to contest an unexpected federal tax bill later in the year for unreported income.
Resource: Unemployment Benefits are Taxable
Resource: What to do When Your Identity is Stolen
- To receive an updated 1099-G in Kansas, fill out a request on the KDOL Self-Service Portal under “Dispute my 1099.” Select the “I want to dispute my 1099” box and upload an Unsworn Declaration that you did not receive the Kansas Department of Labor benefits listed on your 1099-G.
- You can also send a written dispute with your full name and last 4 digits of your social security number to the Kansas Department of Labor:
- Fraudulent 1099 Inquiry
Kansas Department of Labor
401 SW Topeka Blvd.
Topeka, KS 66603-3182
- Make sure that both the written dispute and Unsworn Declaration form state the reason for the dispute as “identity theft.”
- Fraudulent 1099 Inquiry
- Additionally, make sure to visit dol.ks.gov/fraud and submit a report, if you haven’t already.
- Missouri provides 1099-G information online over a secure server. Taxpayers in Missouri should contact the Missouri Department of Revenue with questions or for more information.
- Fraud can be reported through the Missouri DOR website.
- Arkansas residents need to report potential fraud to the Arkansas Division of Workforce Services (DWS). First, send an email to InternalAudit@arkansas.gov or call (501) 682-1058 to speak with the DWS Fraud Investigation Unit.
- Next, file a police report for possible identity theft and submit a copy of your police report to DWS. You can either submit a copy of your police report electronically by emailing InternalAudit@arkansas.gov or in-person at your nearest Arkansas Workforce Center.
- Some taxpayers that have already submitted their police reports may still receive a 1099-G when they are initially issued. Once the claim is processed, you’ll receive a corrected 1099-G stating you received $0 in unemployment benefits.
As always, contact your Adams Brown advisor with any questions you may have.