VA Employment Commission

[bheizer]

What would you do?  Have client that received unemployment income. Becasue she received more then was legal, she mailed check back to VA Employment Commission explaining why. The VEC deposited the check but when they issued 1099 G for 2020, they issued original amount paid which was $19,000,  She was only due $6000 which would not be taxable.

I have not filed the return yet.  Have contacted the VEC numerous times via mail and phone calls with letter explaining and copy of canceled check.  Finally contacted Senator Emmett Hanger asking for help and his office has been very gracious in trying to help but still can't get a corrected 1099.

What would you do in my situation? If I file return and attach explanation, I feel sure the IRS will send bill for tax due on income client does not owe.

Thanks for any advice.

[dkh]

Form 1099-G worksheet has an area to enter amounts repaid. Wouldn't that apply to this ? 

[Just-Lisa-Now-]

Did she mail it back in 2020, or in 2021?

[BobKamman]

The law taxes income, not pieces of paper.  Is this the only reason filing of the return is delinquent?  File the return with the correct amount of UC received.  IRS does not send a bill.  It sends a letter (usually a CP2000) proposing an assessment.  Make sure your client answers it promptly.  It would help to attach an explanation to the original return.  IRS won't look at it when the return is filed, but they might see it when the document matching is done.  Otherwise, you just have to send them a copy of the explanation you have already submitted -- and maybe by then, a copy of the corrected 1099-G.

[bheizer]

 She mailed it back in 2020

[bheizer]

The 1099 G sent to client doesn't have a box for repaid amounts.....the form just had box 1.  

[bheizer]

I checked and check was mailed 11/2/2020 and was deposited 11/6/2020.