Unemployment Fraud Victims Get Taxed, Too?

Some unemployment fraud victims may get a 1099G form from the Commonwealth to pay taxes on unemployment assistance. The state Department of Labor and Industry wants to prevent any income that you did not receive, or file for, from being reported as taxable under your Social Security number. The department is working diligently to process returned fraudulent payments, debit cards, and checks; return a significant number of fraud calls; and investigate identity theft complaints.  

If you know someone who was a victim of fraud and payments were issued to them, but they returned the UC debit card, checks, or direct deposits that they received, they should NOT receive a 1099G. If they got a form and believe they shouldn’t have because they had returned the funds and submitted an identity theft complaint, the department asks for patience while it works through the high workload due to fraudulent claims. They should call the department and confirm that their fraud claim is in process. 

If someone was a victim of identity theft but no benefits were paid on the claim, they also should NOT receive a 1099G. If a claim was opened and paid using your information and you did not receive the funds and therefore were unable to return them to the department, you should visit the UC Benefits website and click “Report Fraud” to complete and submit the Identity Theft Complaint Form. Do not log in. If, upon completion of the investigation, it is found that you were a true victim of identity theft, a revised 1099G will be issued to you. 

To report identity fraud related to Pandemic Unemployment Assistance (PUA), please click here. 

For more information about responding to identity fraud, refer to the “What should I do if I’m a victim of identity theft?” FAQ.