On February 11, the Ohio Department of Job and Family Services (ODJFS) announced an unusually large number of new jobless claims for the week ending Feb. 6, saying that the 194% increase from the prior week was the result of fraudulent activity, with at least 44,000 claims having already been flagged as suspicious.
If you are the victim of a fraudulent unemployment claim, which is a type of identity theft, you can expect to receive a Form 1099-G showing the unemployment benefits the state believes you received. Perhaps worse than the fraudulent claim itself, recipients of 1099-Gs have to pay federal and state income tax on the reported income.
The Ohio Department of Taxation (“ODT”) has issued guidance recommending that anyone receiving a 1099-G reporting benefits they have not received should report this identity theft to ODJFS at the following webpage: https://unemploymenthelp.ohio.gov/, then click on the red ‘Report Identity Theft’ button. ODJFS may also be reached at (833) 658-0394.
ODJFS will confirm the activity is fraudulent and issue a corrected 1099-G. They will also contact the IRS to correct the record so that the victim will not incur a tax liability. Taxpayers may file their federal and state tax returns prior to receiving a corrected 1099-G, but are advised to continue to pursue the corrected form in order to avoid a future tax bill from either the IRS or ODT.
Consistent with this Ohio guidance, the IRS has issued guidance urging victims of identity theft related to unemployment benefits to contact their state agency that administers unemployment benefits. In the case of Ohio, that is ODJFS.
If you would like to discuss issues related to identity theft and fraudulent activity, please contact Derek Heyman or any other ZHF professional.