Tax Tips Unemployed Doesn't Mean Untaxed 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 Published Oct 17, 2008 - [Updated Jul 24, 2019] 1 min read As the economy sinks and unemployment rises, there’s been talk in Washington about temporarily suspending income taxes on unemployment benefits. What, you say? If by misfortune I’m unemployed, I still might have to pay taxes? Yes, you might. At the end of the year you’ve taking unemployment benefits, you’ll get a Form 1099-G (and so will the IRS) reporting what you’ve been paid. It’s good to know this up front, however, because you need to set aside enough money to pay any income taxes you might owe. Depending on your circumstances, you might even be required to make quarterly estimated income tax payments because you’re no longer having taxes withheld by your employer. (Estimated taxes are what the IRS expects people to pay when their income is not subject to withholding, such as investment or self-employment income.) If you want to play it safe, though, the IRS gives you a way. Fill out Form W-4V to have 10 percent of your benefits withheld for federal income taxes. You can do this online, but then you need to make a copy and sign it. Send it to your state unemployment office. Previous Post Understanding Those Part-Year Returns Next Post Waiting…For Your Tax Forms? Written by More from Leave a ReplyCancel reply Browse Related Articles Tax Planning TurboTax Offers Refund Advance to Taxpayers Investments Tax Benefits of Real Estate Investing Self-Employed Business Tax Checklist: What You’ll Need When Filing Uncategorized What Is Deferred Compensation & How Is It Taxed? Investments How Does an Inherited IRA Work? Work Choosing Your Business Structure: 5 Types of Businesses… Tax Deductions and Credits Are HOA Fees Tax Deductible? What You Need to Know Crypto Understanding Crypto and Capital Gains Work 7 Things You Need to Know About the New Business Report… Work Using Form 8829 to Write-Off Business Use of Your Home