Form 1099-G

[tapremark]

I am from Indiana and received a form 1099-G from the state. I have a couple questions. First, there is a spelling error on my first name but that is sort of not important since my husband's name is correct and his is the SS number on the form. Second, the amount is equal to our refund PLUS $650 state pandemic stimulus money we did NOT receive (because of elevated income, I think). Third, the choices on the Turbo Tax form for the form 1099-G do not reflect any of the reasons we received the Form 1099-G). This is a completely new form to me for taxes.

Turbo tax asks me for answers to questions like "choose the type of government payment. Business or farm tax refund, Agricultural program payment, federal disaster payment, Market gain on CCC loan.

I am stumped!

[MonikaK1]

The IRS has determined it will not challenge the taxability of payments related to general welfare and disaster relief. This means that people in the following states do not need to report these state payments on their 2022 Federal tax return: California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Maine, New Jersey, New Mexico, New York, Oregon, Pennsylvania, and Rhode Island. 

Please see this IRS webpage for more information.

A state tax refund from filing the prior year's taxes would only be taxable to the extent there was a tax benefit - i.e., you took an itemized deduction for taxes paid. 

To find the state tax refund section, go to Wages and Income, select Other Income, and then Refunds Received for State/Local Tax Returns. Enter the Form 1099-G amount that represents your tax refund from your 2021 tax return. TurboTax will ask how much you deducted for state and local taxes in 2021 (line 5 from Schedule A).

Please see this Indiana DOR webpage for more information regarding the Automatic Tax Refund payments, and the related credit on the Indiana return, including how to contact them if you didn't receive the payment.