This could be an issue with FTB's slow processing of 2014 returns. Some timely filed 2014 Calif returns were not processed until January 2016 so the FTB issued 2016 1099-Gs for those.
If your 2014 Calif refund was already reported on your federal 2015 return (1040 line 10, because your 2015 tax software put it there for you) then you should do one of two things, depending on what was done with your 2014 Calif tax refund:
- If the refund was sent to you then you still have to report the 2016 1099-G on your 2016 federal return, but you should amend your 2015 federal return to remove the Taxable refunds of state income taxes for that amount, or
- If you applied your 2014 Calif refund to 2015 estimated taxes then you should contact the FTB at (800) 852-5711 and request that your 2016 1099-G be manually corrected to report payment in 2015. No 2015 Calif amended return is necessary in that case and the FTB will report that correction to the IRS so that it won't expect to see the refund $$ on your 2016 federal return.
