Income and Investments How are Unemployment Benefits Taxed? Read the Article Open Share Drawer Share this:Click to share on Facebook (Opens in new window)Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Pinterest (Opens in new window)Click to print (Opens in new window) Written by Philip Taylor Published Mar 9, 2017 2 min read Being out of work and filing for unemployment benefits tends to be low on the list of fun and interesting topics to talk about with your friends. It’s no surprise that accurate information about the taxation of unemployment benefits is somewhat hard to come by. If you find yourself in the position of accepting unemployment benefits, there is no doubt that you have experienced a myriad of emotions and circumstances. However, properly dealing with your finances is important, whether income comes from your job or government assistance. Just how are unemployment benefits taxed? Believe it or not, unemployment benefits are counted as income and are taxable on your federal tax return. As far as your state tax return, it varies from state to state. Although it’s not the best news, it’s better to know now as you sit down to file your tax return. There is one variable, however. You may not need to file a federal tax return if your gross income does not meet the federal income limit of $10,350 ($20,700 if married filing jointly), however if you had federal taxes withheld from your income then you should still file since you may see a tax refund. How should unemployment benefits be reported? If you received unemployment income you will receive a Form 1099-G that details the amount of income you have received from the government as well as any taxes taken out. Can I still get a tax refund? This might be a good spot to remind you that if you request unemployment benefits, you do have the option to have taxes withheld so you won’t owe taxes. Whatever your personal decision may be, it is good to keep in mind that although you may be going through unemployment, there are still ways to keep your head above water. You may also be eligible for valuable tax deductions and credits to give you you’re maximum tax refund. TurboTax will ask you simple questions and give you the tax deductions and credits you are eligible for based on your answers. Previous Post Budget Friendly Ways to Make DIY Holiday Cards Next Post Does Renting My Apartment on Airbnb Make Me Self-Employed? Written by Philip Taylor More from Philip Taylor One response to “How are Unemployment Benefits Taxed?” I have to agree with the valid points you make in your article because I see things like you. Additionally, your content is interesting and really good reading material. Thank you for sharing your talent. Reply Leave a Reply Cancel reply Browse Related Articles Work What Unemployment Means to Your Taxes Tax Planning TurboTax Launches the TurboTax Unemployment Center Tax News Tax Tips for Unemployment Income If You’ve Been Laid … Tax News Unemployment Stimulus: Am I Eligible for the New Unempl… Tax Planning I Was Temporarily Furloughed and Then Came Back to Work… Tax Tips Unemployed? We’ve got some tax tips for you Tax Tips Unemployed Doesn't Mean Untaxed Tax News What Does the Second Coronavirus Relief Bill Mean for t… Tax Planning You May Still Be Eligible To File Your Taxes for Free!