BobKamman
Level 15

I came to the office today expecting to help out a client who had received a notice from the Texas Workforce Commission that his claim for unemployment benefits had been denied because he had not answered a request for additional information. He has never worked in Texas, or applied for unemployment there or anywhere else. They had his correct address, but did not show his employer or SSN.

But first, I had to deal with a notice from my own state unemployment office, about a claim that someone had filed that said his last day of work for me was March 29, 2020. I have never heard of this person, but now I know his SSN (it was issued in California – no comment).

What concerns me about my non-Texas client, though, is that it appears benefits were paid to someone from August 30, 2020 until they decided to question his eligibility on December 20. Will they issue a 1099-G and will he receive a CP-2000 in a couple years? I did some research and found this IRS notice dated December 29, 2020, which I doubt many people have seen yet:

https://www.irs.gov/forms-pubs/identity-theft-guidance-regarding-unemployment-compensation-reporting 

It ends with this hopeful message:

“If a payor or a law enforcement agency determines based on all facts and circumstances that, due to identity theft, payments made under an unemployment compensation program were not made to the individual under whose name the benefits were claimed, the payments should not be reported on Form 1099-G.

“If payments made due to identity theft are mistakenly reported on Form 1099-G in the name of an identity theft victim, a corrected Form 1099-G reporting $0 should be issued to the identity theft victim and filed with the IRS as soon as possible after the error is discovered.”