Unemployment taxes and Form 1099-G

Checked against official sources: October 31, 2026

Unemployment benefits are taxable income. Every January the state sends a tax form that shows what it paid you. This guide explains what the form is, how to deal with taxes, and what to do if the form is wrong.

Taxes on unemployment benefits

  • Unemployment benefits count as income for federal income tax. You must report them on your federal tax return.

    Law: 26 U.S.C. 85(a)

  • You can ask the state to withhold federal income tax at 10% of each payment, using Form W-4V or your state's withholding option. Otherwise you may need to make quarterly estimated tax payments.

    Law: IRS Form W-4V

  • The state sends you Form 1099-G showing the benefits paid to you in Box 1 and federal tax withheld in Box 4.

Plan for the tax bill

You can choose to have tax withheld from each payment, or you can pay estimated tax yourself during the year. If you do neither, you may owe tax when you file. Withholding lowers each payment, so choose it only if you can afford the smaller check.

Keep your own records

  • Keep your payment history from the state's website or your bank statements.
  • Compare the total with Box 1 of your Form 1099-G when it arrives.
  • Keep the tax form, your return and any tax you paid during the year together, in one place.

If the form is wrong

A wrong Form 1099-G can mean an error, or it can mean someone filed a claim in your name. If you did not apply for benefits, treat it as identity fraud and report it to the state.

If someone filed in your name →

Overpayments and your tax refund

  • Your federal tax refund can be taken to pay a past-due state unemployment overpayment caused by fraud or by not reporting your earnings, once it is final under state law. Before this happens, the state must notify you and give you at least 60 days to show that the debt is not owed or not legally enforceable.

    Law: 26 U.S.C. 6402(f)

Phone numbers for a 1099-G you did not expect

1 of the 47 states we have checked list a phone number for this in the data:

Your state's page

Keep reading

The home page also compares all states: maximum weekly benefit, weeks of benefits, appeal deadlines and the waiting week.

Sources