Ohio AG asks Congress to shield unemployment fraud victims from getting taxed
CINCINNATI (FOX19) - Attorney General Dave Yost urged Congress to protect hundreds of thousands of working Ohio people who may have filed fraudulent unemployment claims in their name, shielding them from having to pay taxes on benefits that they never received.
About 1.7 million 1099-G forms will be sent to Ohioans this month who are on record of receiving unemployment benefits. However, believes a significant number of forms will be sent to people who never filed or received unemployment benefits.
The total number of victims is unclear at this time.
“Construction workers, daycare providers, service industry workers – the backbone of this state – have worked hard throughout the pandemic and now the government is going to ask them to pay taxes on money they didn’t receive – it’s just not right,” Yost said.
With other states reporting similar problems, Yost sent a letter to members of Congress asking for safe harbor provisions.
Yost is specifically asking Congress to consider:
- Exclude the amount from the income for the taxpayer in the given year until a final determination is made by the state unemployment compensation administrator that the amount is valid.
- Once an amount is determined to be valid, the IRS shall apply the amount to the tax year in which it was determined to be valid without any penalties or interest.
- If an amount certified to the IRS is determined to be invalid, the unemployment compensation administrator shall indicate to the IRS that the 1099-G was issued in error, and assist the taxpayer with any correction the taxpayer is required to make to modify their reported income to the IRS.
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