If you are unemployed, we wish you the best in finding work. In the meantime, though, be sure to apply these tax tips
-
Unemployment is Taxable
Include all unemployment compensation as income for the year. You should have received a Form 1099-G, Certain Government Payments, before January 31. It would show the amount received and the amount of any federal income tax withheld.
-
There are Different Types
Unemployment compensation includes amounts paid under federal law or state law. It may also include railroad, trade readjustment and airline deregulation laws – even some forms of disability payments can count.
-
Union Benefits May be Taxable
Benefits received from regular union dues as income could be be taxable. Other rules may apply, such as if a taxpayer contributed to a special union fund and those contributions to the fund are not deductible. In this case, report only income exceeding the amount of contributions made.
-
Tax May be Withheld
Those who receive unemployment can choose to have federal income tax withheld by using Form W-4V, Voluntary Withholding Request. Those choosing not to have tax withheld may need to make estimated tax payments during the year.
