Do I owe taxes on Washington ESD unemployment benefits - how much will I pay?

Yes, unemployment benefits are considered taxable income by both federal and state. You should have received or will receive a 1099-G form from Washington ESD showing your total benefits for the year. The amount you owe depends on your total income and tax bracket.

I made the same mistake last year - didn't withhold taxes and got hit with a $1,800 bill. If you made $8,200 in unemployment, you're probably looking at owing around $1,200-$2,000 depending on your other income.

For federal taxes, unemployment is taxed as ordinary income. Washington state doesn't have income tax so you won't owe anything to the state. But yeah, you'll need to report the full amount on your federal return. I'd recommend talking to a tax professional if you're worried about the amount.

Ugh this is exactly why the unemployment system is broken. They don't explain ANYTHING about taxes when you file your claim. Then people get blindsided months later.

Here's what you need to know: unemployment benefits are taxed at your marginal tax rate. If you're in the 12% bracket, you'll owe about $984 on $8,200. If you're in the 22% bracket, it's about $1,804. Plus you might owe self-employment tax if you did any freelance work.

same boat here, collected about $6500 and didnt withhold anything either. starting to panic about tax time

I think there might be some deductions you can take related to job searching that could offset some of the tax burden. Things like resume services, interview clothes, travel costs for interviews, etc.

Whatever you do, don't ignore it and hope it goes away. The IRS will eventually catch up with you and the penalties make it way worse. File your return even if you can't pay the full amount.

My brother went through this exact situation two years ago. He ended up owing about $1,400 on roughly $9,000 in unemployment. He set up a payment plan for like $75 a month and paid it off over two years. Not ideal but manageable.

Pro tip: if you're still collecting unemployment, you can request to have taxes withheld from future payments. Log into your SecureAccess Washington account and look for the tax withholding option.

Just a heads up - if you collected unemployment in multiple states, you'll get separate 1099-G forms from each state. Make sure you report all of them on your federal return.

Been there! What helped me was using a free tax software like FreeTaxUSA or TurboTax Free Edition. They walk you through everything step by step and calculate what you owe automatically when you enter your 1099-G info.

I had issues getting my 1099-G corrected last year because Washington ESD had the wrong amount listed. Took forever to get through to someone on the phone. Eventually found out about Claimyr which actually connects you to ESD agents without waiting on hold forever. Saved me so much time and frustration.

Don't forget that if you paid any union dues or had any other work-related expenses while unemployed, those might still be deductible in certain situations. Worth asking a tax preparer about.

The good news is that if this is your first time owing taxes, you probably won't get hit with underpayment penalties as long as you file and pay by the deadline or set up a payment plan.

One thing to remember is that you can make estimated tax payments for next year if you expect to be in a similar situation. Might help avoid this stress again.