Repayment of Unemployment Benefits

[zeros]

Client had to repay unemployment benefits from a prior year. It is under $3000. Would this be a "adjustment from gross income" or a schedule A deduction subject to 2%?

[Jesse]

Because it is less than $3,000 it would be a schedule A deduction subject to 2%.

[taxea]

do the repayments show on the 1099?

[Jesse]

Whether or not it is reported on the 1099-G if it is for a prior year the treatment would be the same - less than $3,000 = Schedule A.

If the payment and repayment were both in 2011 it can be netted and total reported benefits - repayment = net amount reported.

In either case the amount repaid should show up on the 1099-G in the year it was repaid.

Please do correct me if this advice to Zero is not correct and so that I may learn from my mistakes.