Taxpayers who received unemployment benefits or pandemic related unemployment benefits from the Commonwealth of Massachusetts during 2020 can expect to receive a Form 1099-G (Certain Government Payments) showing the amount of unemployed compensation received. Unemployment benefits received are taxable and must be reported on the 2020 Massachusetts Individual Income Tax return Form 1 or Form 1-NR/PY.
Taxpayers who receive a Form 1099-G reporting unemployment benefits, but did NOT receive unemployment benefits are being asked to notify the Department of Unemployment Assistance (DUA) by filing a fraud report online or by calling the DUA at (877) 626-6800, as someone may have used their identity to falsely claim unemployment benefits. The unreceived income should not be reported on the affected taxpayer’s Massachusetts Individual Income Tax return. Once the DUA reviews the fraud report, they will send a corrected Form 1099-G. Taxpayers are required to keep a copy of all Forms 1099-G with their 2020 tax records and be aware that DOR may ask for an explanation of why the amount shown on the Form 1099-G was not reported on the return. Unemployment Compensation, How to Report Fraud, Mass. Dept. of Rev., 01/28/2021.