Thanks for the reply, however, that method does not work very well as it initially gets taxed for both the Federal and NY State. Then, manually "fixing" the NY State portion as an adjustment in the NY State filing is a rather awkward work-around. Additionally, such a manual entry loses the detail of the NY State issued 1099-G and adds a lot of manual work that could lead to error or trigger an audit.
Why not simply add an "Other 1099-G" category that allows the flexibility to enter the various 1099-G box values, as well as, check boxes for the various situations such as "not taxable for State / local" , etc. and apply it automatically to the Federal and State forms? Such an approach should be flexible enough to address the year-by-year and state-by-state changes and variations that you mention.
