It is recommended recipients of grant or cooperative agreement awards consult their tax advisor regarding any tax requirements. According to the IRS website, "A federal grant is ordinarily taxable unless stated otherwise in the legislation authorizing the grant.". Awards of $600 or more are reportable.
Frequently Asked Questions
How does a recipient receive a Form 1099-G?
The IRS Form 1099-G is generated by the Financial and Business Management System (FBMS) using information received from the System for Award Management (SAM). This is an automatic process; it cannot be overridden by Interior Business Center (IBC) staff. This affects all recipients of federal financial assistance except private persons, UNLESS they opt to register in SAM.
Do recipients receiving award funds from programs exempt from tax reporting receive a 1099-G?
Yes, if the recipient is registered in SAM. For private persons who are recipients opt out of SAM, IBC can waive them from receiving a 1099-G.