Bad actors are continuously mining the dark web for personal information to see if they can fraudulently benefit from your stolen data. Unemployment benefits are one area where identity thieves are taking advantage of the online process. If you received a Form 1099-G, a notice from the State Workforce Agency, or a communication from your employer about unemployment benefits you did not receive, your identity may have been stolen, and someone could be filing for unemployment payments in your name.
Are you a victim of unemployment fraud?
Has Your Identity Been Stolen?
If you believe your identity has been stolen, you need to take action to alert the State Workforce Agency about the potential fraud to ensure that you are not on the hook to repay these benefits and avoid the potential for liens and penalties.
Frequently Asked Questions
How do I know if I have been a victim of unemployment fraud?
There are several ways that you may find out that you are a victim of unemployment fraud:
- You receive an IRS Form 1099‐G showing benefits collected for unemployment insurance.
- You receive a notification from the State Unemployment Agency related to unemployment. Sometimes the first notification you may receive is a notice of overpayment of benefits.
- You are notified by your employer that a claim has been filed while you are still employed.
- You try to file a claim for unemployment benefits and learn that a claim has already been filed.
What is an IRS Form 1099-G and why is it important?
A Form 1099-G is a tax form that issued in January and is used by a federal, state or local government if they made payments to an individual. While a 1099-G can be issued for things like a state or local income tax refund, it is also used to report any unemployment compensation received that year. If you received a 1099-G, you may need to report the information it contains on your tax return, and you could be responsible for paying taxes on listed income. You can learn more about the Form 1099-G here.
I did not receive unemployment benefits last year. Why did I get a Form 1099-G?
If you received a Form 1099-G for unemployment compensation but did not receive an unemployment payment in the previous year, you may be a victim of unemployment fraud. This means your identity may have been stolen and a fraudulent unemployment claim was filed using your personal information. To learn more about unemployment fraud visit our FAQ page for employees.
What should I do if I am a victim of unemployment fraud?
- Do not ignore the Form 1099-G. Failing to report information from the 1099-G on your tax return could mean owing more on your taxes as well as potential penalties and interest. The state may not realize that you are an identity theft victim, and you will want to notify the state before a notice of overpayment or reimbursement is issued by the state.
- Resolve the Claim. Contact your state agency to report that your identity has been used to claim UI benefits. You can find the specific contact information using the state contact guide found here. Filing a claim with another person’s identity is a felony and is subject to prosecution. Therefore, the agency would like to obtain additional information for their case file. It is faster and easier to notify the state using their online services whenever possible.
- Protect yourself from future incidents. If your personal information has been compromised, you may be exposed to additional threats like someone accessing your bank account, savings or 401K investment, being charged with a crime you didn’t commit, or even being held responsible for fraudulent medical claims. You should take all steps necessary to resolve the fraudulent claim and continue to monitor your digital and financial identity.
We encourage you to review the Federal Trade Commission website for additional information and guidance related to identity theft. Recommended actions include, but are not limited to:
- Contact bank and credit card companies.
- Communicate with the IRS (https://www.irs.gov/identity-theft-fraud-scams/identity-theft-and-unemployment-benefits)
- Taxpayers who were victims of an unemployment benefits identity theft scheme should consider opting into the IRS Identity Protection PIN program. An IP PIN is a six-digit number that helps prevent thieves from filing federal tax returns in the names of identity theft victims. The IP PIN is a voluntary program open to any taxpayer who can verify his or her identity. See details at Get an IP PIN.
- Contact all three of the credit reporting agencies (Equifax, Experian, and TransUnion) to place a freeze on your credit report.