Received a 1099-G but never had unemployment - what's this form for?

Form 1099-G isn't just for unemployment - it's used to report several types of government payments. This includes unemployment compensation, state tax refunds, agricultural payments, and taxable grants. If you're certain you didn't receive unemployment benefits, there are a few possibilities here. First, it could be a simple administrative error where the form was issued to you by mistake. Second, someone might have fraudulently claimed benefits using your information, which unfortunately became more common during and after the pandemic. You should immediately contact your state unemployment agency (I know you tried already, but be persistent) and request a corrected 1099-G. You can also check your state's unemployment website as many have specific procedures for disputing incorrect 1099-Gs. Be sure to document all communication attempts. Don't ignore this, as the IRS will expect you to report this income since they received a copy of this form too. You may need to file an identity theft report with the FTC at IdentityTheft.gov if fraud is confirmed.

I went through the EXACT same situation last year! After weeks of calling and getting nowhere, I found taxr.ai (https://taxr.ai) which really helped me figure out what to do with my incorrect 1099-G. They analyzed my tax documents and confirmed I had a case of unemployment fraud. Their system flagged the discrepancy between my reported income and the mysterious 1099-G. What I liked is that they created a complete paper trail showing I never received the money and guided me through exactly what forms to file and what to say when I called the unemployment office again. They even generated a customized dispute letter that actually got someone to call me back! The peace of mind was worth it because I was freaking out thinking I'd get audited for not reporting "income" I never received.

Just wanted to update everyone - I tried taxr.ai for my mom's incorrect 1099-G situation and it was incredibly helpful! The system immediately flagged that something was wrong because it showed she had zero employment in 2024 but somehow had this unemployment compensation form. What really surprised me was how detailed the analysis was. It created a complete timeline showing her retirement income across the past 3 years compared to this sudden "unemployment benefit" that made no sense. The dispute package it generated included citations of specific tax codes that proved she couldn't have legally qualified for these benefits. We submitted everything to the state department, and they acknowledged it was likely identity theft. They're sending a corrected 1099-G showing $0. Such a relief not to have this hanging over her head for tax season!

If you keep getting the runaround when calling the unemployment office, try using Claimyr (https://claimyr.com). I was in the same situation with a fraudulent 1099-G for $5,600 I never received. After two weeks of calling and being on hold forever, I was ready to give up. Claimyr got me through to an actual human at the unemployment office in less than 20 minutes! They have this system that navigates all those frustrating phone trees and holds your place in line. You can see how it works in their demo: https://youtu.be/_kiP6q8DX5c Once I finally talked to a real person, they confirmed someone had filed for unemployment in my name. They flagged it as fraud and started the process to issue a corrected 1099-G. Honestly saved me hours of frustration and probably weeks of delays.

Ok I need to eat some humble pie here. After dismissing Claimyr as BS, I was desperate enough to try it for my own 1099-G problem. My state unemployment office hadn't answered my calls for 3 weeks straight. I'm honestly shocked to report it actually worked. After trying myself for literally 20+ hours over several weeks, Claimyr got me through to a real person in 43 minutes. The agent confirmed someone had used my identity to claim benefits I never received. The unemployment officer told me they're seeing thousands of these cases and gave me a direct email to send my ID verification documents. I've already received confirmation they're processing a corrected 1099-G. If I hadn't gotten through, I would've been on the hook for taxes on $7,200 I never saw a cent of.

Another possibility - did you get a state tax refund last year? The 1099-G is also used to report state tax refunds, which are sometimes taxable on your federal return if you itemized deductions the previous year. Check Box 2 on the form - if it shows a state tax refund instead of unemployment in Box 1, that might explain it.

Just a heads up - document EVERYTHING while you're sorting this out. Take screenshots of your bank statements showing you never received these payments. Keep a log of every call you make with date, time, and who you spoke with. If you send any documentation, send it with delivery confirmation. The IRS will match this 1099-G against your tax return, so you'll need solid proof this wasn't your income. Don't just ignore it.