Unemployment repayment

[Mkrubi]

I was overpaid and I've been paying my overpayment through my unemployment  weekly benefits where they take 50% of my benefits. How do I report those payments since I'm not paying it cash or by check? Or are those included on the 1099 G? 

[Mike9241]

if the repayment is in the same year as received, the form should be net and there is nothing special you need do.  Check the form against the net amounts received   

if repaying in 2020 for a prior year overpayment and the repayments for the year are $3,000 or less, the change in the tax laws denies you any tax benefits.

if more than $3,000 you have an option

you can take as a deduction on schedule A line 16 denote as IRC 1341 repayment

OR
recompute the taxes in the year you received the payment by excluding the payment.
the decrease in taxes is taken as a credit on schedule 3 line 12d denote as IRC 1341

[Tax-Season-Pain]

Hi, I have a follow up question to ask. Are you saying that if I am overpaid unemployment in 2020 (about $1,200), and if I repaid it in early 2021, I can't claim I repaid the 1,200 in either 2020 or 2021 tax return? 

[JohnB5677]

You are essentially correct.  If you made the repayment in the year after you received the unemployment it would fall under this rule:

If the amount of unemployment repayment is $3,000 or less, deduct it on Schedule A in the year you repaid it. The deduction is subject to the limit of 2% of your adjusted gross income (AGI).