If this 1099-G is reporting a CRP (Conservation Reserve Program) payment, you are required to enter it on schedule F. In TurboTax this section is called Farm Income and Expenses. You will need to upgrade to the online version of Self Employed. I understand you are retired and not actively farming. There is an exclusion just for people like you. After you enter this income on schedule F under Payments from the Government reported on 1099-G you then need to review the Ag Programs section just below it to see if SE tax applies. This income is subject to federal and state income tax. Be sure to include your expenses associated with this income (RE taxes, vehicle mileage, insurance, weed spray, etc.)
Below is from IRS publication 225, page 11;
Conservation Reserve Program (CRP)
Under the Conservation Reserve Program (CRP), if you own or operate highly erodible or other specified cropland, you may enter into a longterm contract with the USDA, agreeing to convert to a less intensive use of that cropland. You must include the annual rental payments and any onetime incentive payment you receive under the program on Schedule F, lines 4a and 4b. Costshare payments you receive may qualify for the costsharing exclusion. See Cost-Sharing Exclusion (Improvements), later. CRP payments are reported to you on Form 1099G.
IRS Tip; Individuals who are receiving Social Security retirement or disability benefits may exclude CRP payments when calculating self-employment tax. See the instructions for Schedule SE (Form 1040).
TurboTax will do this above IRS Tip for you if you go thru the Ag Program interview.
