NYS Department of Labor unemployment benefits - how does federal unemployment tax affect my payments?
I just started collecting unemployment benefits through NYS Department of Labor and I'm trying to understand the tax situation. My friend mentioned something about federal unemployment tax but I'm confused - is this something that gets taken out of my weekly benefits automatically? Or is it something I need to pay when I file my taxes next year? I've been getting $420 per week and want to make sure I'm handling the tax part correctly. Does NYS Department of Labor give you any paperwork about this?
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Liam McGuire
The federal unemployment tax (FUTA) is actually paid by employers, not taken from your benefits. What you're probably thinking of is federal income tax on your unemployment benefits. NYS Department of Labor can withhold 10% for federal taxes if you request it on your weekly claim, but it's optional. You'll get a 1099-G form in January showing your total benefits received for tax filing.
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Mei Zhang
•Oh wow, so I should be having taxes withheld then? I didn't know unemployment was taxable income!
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Amara Eze
yeah unemployment is definitely taxable, learned that the hard way last year when i owed like $800 at tax time
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Mei Zhang
•Yikes! How do I set up the withholding through NYS Department of Labor?
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Giovanni Ricci
You can elect tax withholding when you file your weekly claims online. Log into your my.ny.gov account and look for the tax withholding option in your weekly certification. NYS Department of Labor will take out 10% for federal taxes if you choose that option. I'd recommend doing it unless you're planning to save money yourself for taxes.
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Mei Zhang
•Perfect, thank you! I'll do that with my next weekly claim filing.
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NeonNomad
Wait I'm confused about this too. If I'm having trouble even getting through to NYS Department of Labor to resolve an issue with my claim, how am I supposed to handle the tax stuff? I've been trying to call for weeks about an adjudication issue and can't reach anyone.
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Fatima Al-Hashemi
•I had the same problem calling NYS Department of Labor until someone told me about Claimyr. It's a service that helps you actually get through to a real person at the unemployment office. Check out claimyr.com - they have a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. I was able to get my adjudication resolved in two days after being stuck for a month.
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Dylan Mitchell
Just want to add that even though federal unemployment tax (FUTA) is paid by employers, your unemployment benefits are still considered taxable income by the IRS. So definitely either have the 10% withheld or set aside money for taxes. The 1099-G from NYS Department of Labor will show exactly what you received for the year.
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