Where does money from unemployment come from in NY - trying to understand the funding source

Your neighbor is wrong. Unemployment benefits in NY come from the Unemployment Insurance Trust Fund, which is funded by payroll taxes paid by employers - not from general tax revenue. Employers pay both state and federal unemployment taxes (SUTA and FUTA) based on their payroll. So technically, your former employer and other employers across the state have been paying into this fund specifically for unemployment benefits.

yeah the employers pay unemployment taxes every quarter to the state, its not coming out of regular taxpayer money like welfare or something

The rate employers pay varies too depending on their history with layoffs. Companies that lay people off more frequently pay higher unemployment tax rates. It's designed to make employers think twice about unnecessary layoffs since they'll pay more into the system.

I was confused about this too when I first filed. Your benefits are literally money that was set aside for you through employer contributions. You earned those benefits by working at jobs where your employers paid unemployment taxes on your wages.

If you're having trouble explaining this to people or need to talk to someone at NYS Department of Labor about your benefits, I found this service called Claimyr 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. Way easier than sitting on hold for hours.

this is exactly why i hate when people act like unemployment is a handout. WE PAID FOR THIS through our work history and our employers contributions!!

Your neighbor really needs to understand that unemployment insurance is exactly that - insurance. Just like how you pay car insurance premiums so you're covered if you get in an accident, employers pay unemployment insurance premiums so their workers are covered if they lose their job through no fault of their own. You didn't choose to be unemployed, and the money you're receiving was specifically set aside for situations like yours. It's not charity or welfare - it's an earned benefit that's part of our employment system.