In an effort to slash over $700,000 from their budget, NY State has eliminated the mailing of form 1099-G (Statement for Recipients of State Income Tax Refunds) to New York taxpayers. 1099-G’s are issued to taxpayers that receive NY State refunds–which are considered taxable income on the following year’s income tax return.
In the absence of this form, taxpayers (especially those that self-prepare their returns) run the risk of neglecting to include their previous state refund on their 2009 tax return this year, which could result in a delayed refund and potential penalties and/or interest as it could take years for the IRS to notify taxpayers of errors. Furthermore, NY State has delayed many refunds over the last year and a lot of NY taxpayers have yet to receive their 2008 refunds. In this case, one would NOT have to claim their 2008 NY refund on their 2009 tax return. Very confusing, I know.
All returning R&G Brenner clients will not have any problems relating to this as our tax software was specifically programmed to carry over the necessary information to your 2009 tax returns. However, for non-clients that would like to obtain 1099-G information, you can do so by:
Source: NY Department of Taxation and Finance