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Isabella Santos

EDD reported $25,000 on 1099-G that my husband never received - possible fraud?

My husband got his 1099-G tax form from EDD showing $32,000 in unemployment benefits for 2023, but he NEVER received this money or even certified for it! His UI Online account doesn't show these payments, and nothing was ever loaded onto his Money Network card. We're completely confused and worried about tax implications. Has his account been hacked? This is making our tax filing a nightmare since the IRS will think we earned this phantom money. Has anyone dealt with this kind of situation before? What steps should we take to fix this mess with EDD and the IRS? We're freaking out about potentially owing taxes on money we never saw!

StarStrider

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This is 100% identity theft/unemployment fraud. Your husband needs to contact EDD immediately to report this as fraudulent activity. Call the EDD fraud hotline at 1-800-229-6297 or submit the fraud reporting form online. They'll need to issue a corrected 1099-G. Don't file your taxes with the incorrect form or you'll end up paying taxes on money someone else stole.

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Thank you for confirming my fears! Should we also file a police report? I'm worried the IRS deadline will come before EDD fixes this. Do we need to file for an extension on our taxes?

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Ravi Gupta

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This happened to me last year!! Some scammer filed for benefits using my info while I was still working. The 1099-G showed $27,000 I never got. It took FOREVER to reach anyone at EDD. I spent weeks calling that stupid number where it just hangs up on you after saying they have too many callers. Finally used a service called Claimyr (claimyr.com) which got me through to a real person. They have a video showing how it works: https://youtu.be/JmuwXR7HA10?si=TSwYbu_GOwYzt9km. Once I actually talked to someone, they flagged my account for fraud investigation and sent a corrected 1099-G about 3 weeks later.

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did the service actually work? seems sketchy to use a third party just to make a phone call tbh

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Omar Hassan

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Omg thats terrible!! The same thing happned to my cousin last year. So many scammers out there stealing benefits from the system!! 😡😡😡

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Yeah and EDD does NOTHING to stop it! They let these fraudsters collect thousands while legit people have to jump through hoops for every penny. The whole system is broken beyond repair.

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Diego Vargas

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You need to take these specific steps: 1. Report the fraud to EDD immediately using their fraud reporting form online AND call the fraud hotline 2. Request a corrected 1099-G (Form DE 1299G) through UI Online or by calling 3. File IRS Form 14039 (Identity Theft Affidavit) 4. Check your credit reports for other suspicious activity 5. File a report with the FTC at IdentityTheft.gov 6. Consider placing a credit freeze For your tax return, you should NOT report the incorrect amount on your taxes. The IRS is aware of unemployment fraud issues and has guidance on their website. If you can't get a corrected 1099-G before the filing deadline, file for an extension and attach a statement explaining the situation.

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This is incredibly helpful, thank you! I'm going to start with these steps today. Do you know roughly how long EDD typically takes to issue a corrected 1099-G? I'm really concerned about the timing.

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Ravi Gupta

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@sketchy_person - Yes, it actually worked for me. I was desperate after trying for 2 weeks straight. It's just a service that keeps redialing EDD until it gets through, then connects your call. Weird but effective when you're at your wits end.

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oh ok that makes sense. might try it if i cant get thru tomorrow

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Diego Vargas

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@worried_tax_filer Processing time varies but expect 4-8 weeks for a corrected 1099-G. The good news is EDD will also notify the IRS of the correction, so there's an official record of the fraud. If you're approaching the tax deadline, definitely file for an extension (Form 4868) which gives you until October 15th. You'll need to estimate any taxes you actually do owe and pay those with the extension request.

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Will do! I guess we're filing for an extension. My husband is going to try calling first thing tomorrow morning. Thanks again for the guidance!

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CosmicCruiser

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This is happening EVERYWHERE right now. I work in tax preparation and we're seeing dozens of clients with this exact issue. The 2023 fraud numbers are through the roof. One important thing to know - DO NOT IGNORE THIS! The IRS computers will automatically flag your return if you don't report the income shown on the 1099-G. Even if you're waiting for a corrected form, you need to address it in your filing with a statement explaining the situation. Otherwise, you'll likely get an automated CP2000 notice and potentially penalties.

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That's so helpful to know! Would you recommend we work with a tax professional this year instead of doing our taxes ourselves like we usually do? This situation feels over our heads.

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i went thru this hell last year. EDD is completely usless. took me SIX MONTHS to get a corrected 1099!!!!! the WORST part is they make YOU do all the work when THEY screwed up by not having proper security!!!! and good luck actually talking to anyone there, its impossible.

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Omar Hassan

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Six months?!?! Thats insane!!! Did you have to pay taxes on that money in the meantime???

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CosmicCruiser

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@worried_tax_filer Yes, in this situation I'd definitely recommend working with a tax professional. They can help ensure everything is properly documented and can advise on exactly how to address this on your return. The cost of professional help will be worth avoiding potential issues with the IRS down the road. Make sure to bring any documentation showing you've reported the fraud to EDD when you meet with them.

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@concerned_neighbor no, i filed an extension and waited until i got the corrected form. no way i was paying taxes on $$ some scammer stole! but the stress was unbearable, especially watching the extension deadline get closer with no resolution. the system is BROKEN.

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StarStrider

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Just checking in - have you been able to report this and start the process with EDD? Any updates?

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Yes! After trying the regular EDD number for two days and getting nowhere, we tried the fraud-specific number and actually got through! They took all our information and said they're flagging the account for investigation. They said we should receive a corrected 1099-G in 4-6 weeks and we've already filed for our tax extension. We're also working with a CPA now to make sure we handle this correctly. Thanks for all the help everyone!

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So glad you were able to get through to someone at EDD! That's honestly the hardest part of this whole process. The 4-6 week timeline sounds about right from what I've seen. Make sure to keep detailed records of all your communications with EDD - dates, times, reference numbers, names of who you spoke with. This documentation will be crucial if there are any delays or issues with the corrected 1099-G. Also, don't forget to monitor your credit reports regularly over the next few months since identity thieves often try multiple types of fraud once they have someone's personal information. You're handling this exactly right by getting professional tax help and filing the extension. Best of luck with the resolution!

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Amara Okafor

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Great advice about keeping detailed records! I'd also suggest taking screenshots of your UI Online account showing no payment history, since that's additional evidence that you never received the benefits. It might help speed up the investigation process. Also, once you get the corrected 1099-G, double-check that it shows $0 for unemployment compensation - sometimes they make errors on the corrections too. You're doing everything right by staying on top of this!

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