Do they tax unemployment benefits in California EDD?

Wait so I can turn on withholding now even though I already got my first payment? Or do I have to wait until my next certification?

You can choose it on your next certification, yes. It won't cover what's already been paid out but going forward it'll handle the federal piece automatically.

The 1099G thing tripped me up last year because I'd gone paperless so I didn't get a physical copy. Had to log in and find it under the Payments section. Worth knowing ahead of time.

So the 1099G shows what you actually received after the 10 percent was taken out? That's good to know.

The 1099G shows the gross benefits paid before any withholding — the withholding itself is noted separately on the form, similar to how a W-2 works. The agent above probably explained it that way.

Right, the agent actually walked me through exactly that — the box for total benefits and the separate box for federal tax withheld. Made sense once I saw it explained that way.

I didn't realize EDD even offered withholding until I saw this thread. Turning it on at my next certification for sure.

Ugh that's exactly what I was afraid of. Turning on the 10 percent now.

Same thing happened to me the first time I collected back in the day. Thought it was tax-free money and then got slapped at filing time. Lesson learned the hard way.

Ohh I always thought the CASDI thing was unemployment related. That clears something up I've been confused about forever.

Super common mix-up. CASDI is SDI — State Disability Insurance. UI is funded by the employer side. Totally different buckets.

I definitely thought I had been paying into it too. So basically the tax treatment has nothing to do with contributions, it's just federal law that says it counts as income.

That's the right way to think about it — a small overpayment that comes back to you is way better than a surprise bill.

Okay this is making me feel better about opting in. I'll do it at my next certification for sure.

The fraud 1099G thing is a real issue — heard about a lot of people getting them for claims they never made. Good to flag that.

Yeah EDD has a way to report it through Ask EDD or by calling their fraud line. You absolutely should not just file it like it's real income if you didn't collect.

That's honestly the clearest way I've heard it put. Federal yes, state no. Got it.

Bookmarking — wait, never mind. But seriously, clearest explanation in this whole thread.

Federal yes, state no. Writing that on a sticky note next to my computer.

That's a smart way to think about it mentally. I'll probably do the same.

$31 a payment adds up though. At the end of a 26-week claim that's actually a decent chunk already withheld.

Yeah the federal and state forms are independent. What you exclude on the state side doesn't change what you show on the federal.

This distinction matters a lot because if you just skip the federal reporting thinking 'it's not taxed' you could end up with an IRS issue, not just an EDD issue.

$275 times however many weeks you've collected is your total benefits so far. That full amount is federally taxable. Whether you owe anything depends on your total income for the year, your filing status, deductions, etc. — no one here can say exactly what you'll owe. Turning it on now for the remaining weeks helps, and setting aside a bit from past payments covers the rest.

Ugh okay. At least it's not California tax on top of it too.

You might also look at making an estimated tax payment to the IRS before April if you're really worried. Cuts down on any potential penalty for underpayment.

I almost missed that question the first time because I was clicking through fast. Worth slowing down on that screen.

Going to log in right now and do my next certification carefully. Thanks for pointing that out.

Wish I had done that before my first payment. Would have made the tax question feel less urgent now.

EDD's calculator is pretty accurate too — my actual DE 429Z matched what it estimated almost exactly.

$450 max is wild to me because that doesn't go very far in California. But yes, 10 percent of that is nothing compared to owing a lump sum in April.

Between the waiting week that doesn't get paid and the federal taxes, UI benefits are always a bit less than people expect. Good to go in with accurate expectations.

No, selecting withholding has zero effect on your eligibility or claim status. It's completely separate from the eligibility determination side. It just reduces the deposit on your card by 10 percent and EDD sends that portion to the IRS on your behalf.

Okay good, I was being ridiculous. Turning it on today.

Eligibility review and payment options are totally different parts of the system. You can change your payment method and withholding without touching anything on the claim side.

No retroactive option — withholding only kicks in going forward from the certification where you elect it. For the weeks already paid, you'd just set aside what you think you might owe federally and cover it when you file or through an estimated payment.

Figured as much. At least $640 total for two weeks isn't a huge amount to track manually.

The reopening part is something a lot of people don't know. Good to have it here.

Does reopening change the weekly benefit amount or is it locked from the original claim?

The weekly amount is set when the claim is opened — reopening doesn't recalculate it. You'd keep the same weekly benefit amount from the original claim.

Good catch. My dad asked me about this because he was collecting UI and Social Security at the same time and I had no idea what to tell him. He should ask EDD directly about how the pension interacts.

Yeah for the pension side I'd go straight to EDD because how it affects the weekly amount depends on the specifics of the pension — nobody here should be guessing at that.

The Social Security part surprised me honestly. I assumed everything counted against the payment.

I got my DE 429Z but kind of glossed over it. Going to dig it out and use it to estimate what I might owe federal.

30-day window on the DE 429Z is real and people miss it. If you think your wages were reported wrong it's worth checking against your pay stubs right away.

Hard agree. The opt-in model just sets people up to forget or not know.

EDD in general isn't great at making options visible. Same with direct deposit — you have to go find it rather than it being pushed at you.

Both are probably by design honestly. Less setup friction gets more people through the system but then they deal with downstream problems they didn't know about.

EDD reports that information to the IRS on its own. The 1099G you get is your copy so you can fill out your return accurately — EDD has already told the IRS what was paid. That's why it matters to report it correctly on your federal return even if no one asks you to prove it.

Okay that makes sense. So the IRS already knows and you just need to make sure your return matches what they have on file.

The severance question is something a ton of people have. Good to know it still gets reported on the certification even if it may not affect payment the same way wages do.

I had a small severance payment too and had no idea whether to report it or not. Sounds like the answer is report it and let EDD sort it out.

That's a relief, I was worried I'd have to remember to pick it every two weeks.

Confirm this was my experience too. Set it once and it stayed through the rest of the claim. The 1099G at the end reflected all the withholding properly.

Does part-time earnings count as a separate line on the 1099G or is it just the total benefits figure?

The 1099G only shows what EDD paid you in benefits — your wages from the part-time job would show on a W-2 from the employer and get reported separately. They're two different income sources on the return.

That makes sense. Two different forms, two different boxes on the federal return, same tax year.

The certification confirmation screen should have shown your withholding election before you submitted. If you're not sure, you can check through UI Online under your claim or use the live chat in UI Online — it's available through the Help button, Monday through Friday 9 to 2. An agent can confirm whether the withholding is showing on your account.

Okay I'll check the live chat next week. That's way more accessible than trying to get through on the phone.

I called the interview a 'hearing' in my head the whole time I was going through it. Definitely two different things.

The DE 4800 notice has the date and time for the interview on it — the interviewer phones at that time, so you just keep your phone nearby. Good to know it's not the same as actually appealing something.

To add to that: if you get a denial after the interview, the Notice of Determination (DE 1080CZ) that comes in the mail is what starts the appeals clock. You'd have 30 days from the date on that notice to appeal using the DE 1000M form. That's the actual appeal process.

This is the summary I needed from the start honestly. Federal yes, California no, turn on 10 percent at next certification, check UI Online in January for the 1099G.

Saving this whole thread. Turned on withholding today, feel way less panicked about April.

For the people who can't get through on the phone to ask EDD questions about their specific claim, I ended up reaching an agent through Claimyr for my severance question. Got a straight answer the same day instead of waiting weeks for a response through messaging.