Delayed 1099G January 2018 Tax News

The additional return analysis could delay processing of the return, which could result in the refund being issued to the taxpayer in the next tax year.

When a refund is issued in the next tax year, the 1099G will be issued for the tax year the taxpayer received the refund. Taxpayers must report the refund in the year the refund was received, not the year the tax return was filed. This could require an update to how you or your client report the income.

When tax preparation software is used, the 1099G amount may be automatically populated for the year the tax return was filed. The taxpayer will need to update the 1099G information to show the year the refund was received. If using a tax preparer, the taxpayer should notify their preparer of the year the refund was received and ensure the 1099G information is updated.

If a taxpayer does not have a 1099G, the following methods can be used to verify the correct tax year and obtain the amount: MyFTB, Secure Chat, or Tax Practitioner Hotline.

We are currently exploring the feasibility of notifying taxpayers to be aware of any potential tax planning changes they may need to make when a return is not completely processed by the end of the calendar year.