Are unemployment benefits taxable income - NYS Department of Labor
Getting ready to file my 2024 taxes and realized I have no idea if the unemployment benefits I received last year count as taxable income. I was on unemployment for about 4 months after getting laid off from my retail job. NYS Department of Labor sent me a 1099-G form but I'm not sure what that means exactly. Do I need to report all of it on my tax return? Should I have been setting money aside for taxes this whole time? Kind of panicking because I spent everything just trying to pay rent and bills.
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Fatima Al-Suwaidi
Yes, unemployment benefits are considered taxable income at the federal level and in New York state. The 1099-G form you received from NYS Department of Labor shows the total amount of benefits paid to you in 2024. You'll need to report this on both your federal and state tax returns. The good news is you can choose to have taxes withheld from your weekly claims going forward to avoid owing a large amount next year.
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Giovanni Mancini
•Oh no, so I owe taxes on the full amount? I received about $8,000 total. How much should I expect to owe?
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Dylan Cooper
yeah i made this mistake too last year. unemployment is taxable but they dont automatically take taxes out unless you ask them to. when youre filing your weekly claims theres an option to have 10% withheld for federal taxes. wish someone had told me that earlier because i ended up owing like $1200
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Sofia Morales
•You can actually request tax withholding by logging into your my.ny.gov account and updating your payment preferences. It's under the 'Manage Benefits' section. Much easier than trying to call NYS Department of Labor.
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StarSailor
The amount you'll owe depends on your total income and tax bracket. If unemployment was your only income, you might not owe much since the benefits are relatively low. But if you had other income during the year, it could push you into a higher bracket. I'd recommend using a tax calculator or talking to a tax professional.
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Giovanni Mancini
•I worked for about 8 months before getting laid off so I had W-2 income too. Sounds like I should definitely talk to someone about this.
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Dmitry Ivanov
WAIT you can have taxes withheld from unemployment?? I've been on benefits for 2 months and nobody at NYS Department of Labor mentioned this when I filed my claim. How do I set this up? I definitely don't want to get hit with a huge tax bill next year.
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Fatima Al-Suwaidi
•Log into your my.ny.gov account and look for 'Tax Withholding' under your claim management options. You can choose to have 10% withheld for federal taxes. Note that this only covers federal - you might still owe state taxes depending on your situation.
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Ava Garcia
I had such a hard time getting through to anyone at NYS Department of Labor to ask about this tax withholding option. Kept getting disconnected after waiting on hold for hours. Finally found this service called Claimyr (claimyr.com) that helped me get connected to an actual agent who walked me through setting up the withholding. They have a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. Saved me so much frustration.
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Dmitry Ivanov
•Interesting, never heard of that service. Did it actually work? I'm so tired of not being able to reach anyone at NYS Department of Labor.
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Ava Garcia
•Yeah it worked great. Got connected within like 15 minutes instead of the usual hours of waiting. The agent was really helpful explaining the whole tax situation too.
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Miguel Silva
Just want to add that if you can't afford to pay the taxes you owe on your unemployment benefits, the IRS offers payment plans. Don't just ignore it hoping it goes away - that makes everything worse. File your return even if you can't pay immediately.
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