A certain taxpayer received unemployment payments in the amount of $3,360. Later on in the same year the Arizona Department of Economic Security (DES) decided that the taxpayer was not eligible to these payments. Consequently, the taxpayer repaid the unemployment benefits in the following tax year. He received a 1099-G from the DES but did not report the earnings on their tax return.
The IRS contended that because the taxpayer did not repay the money in the same year that it was issued, it became fixed for the year, and itconstituted taxable income. The taxpayer argued that the payments were not taxable under the recession doctrine.
The tax court agreed with the IRS. Because the taxpayer did not repay the money in the same year the money was received, it was taxable.
Don't let this happen to you! If you have any questions regarding your unemployment benefits, call our office. We can help you determine the taxability of your benefit payments.
The IRS contended that because the taxpayer did not repay the money in the same year that it was issued, it became fixed for the year, and itconstituted taxable income. The taxpayer argued that the payments were not taxable under the recession doctrine.
The tax court agreed with the IRS. Because the taxpayer did not repay the money in the same year the money was received, it was taxable.
Don't let this happen to you! If you have any questions regarding your unemployment benefits, call our office. We can help you determine the taxability of your benefit payments.
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