Do I owe taxes on Washington ESD unemployment benefits received in 2024?

Thanks! So I just enter the amount from the 1099-G on my tax return? Do I need to do anything special?

Yep, just report it as unemployment compensation on your 1040. The form should have everything you need.

That was only for 2020 tax year when they excluded the first $10,200 of unemployment benefits. For 2024 benefits, it's all taxable again unfortunately.

Ugh, that sucks. I wish they'd kept that exemption.

You could have requested 10% federal withholding when you filed your weekly claims. If you didn't, then yeah you'll probably owe taxes on the full amount.

Crap, I never knew about the withholding option. Guess I'm setting aside money for taxes now.

You can still make quarterly estimated payments if you're worried about owing too much. Check the IRS website for Form 1040ES.

The 1099-G shows your total unemployment benefits for the year - that's all taxable. Your W-2 income is separate and also taxable. You report both on your tax return.

Okay that makes sense. So it's not like they reduce the taxable unemployment amount because I worked some weeks?

Nope, whatever Washington ESD paid you in benefits is what's taxable, regardless of your other income.

Check your online account at secure.esd.wa.gov - you might be able to download it there. If not, you'll need to call Washington ESD to request a copy.

Good luck getting through to them on the phone. I've been trying to reach Washington ESD for weeks about a different issue and can never get through. The lines are always busy or I get disconnected after waiting forever.

Have you tried using Claimyr? It's a service that helps you get through to Washington ESD agents. I used it last month when I couldn't reach them about my claim status. Check out claimyr.com - they have a video demo at https://youtu.be/7DieNd3C7zQ that shows how it works.

Never heard of that before. Is it legit? How much does it cost?

Yeah it's legitimate. They basically keep calling Washington ESD for you until they get through, then connect you to an agent. Way better than sitting on hold for hours yourself.

Glad you found it! Now the fun part of actually filing taxes lol

That's a good point. I'll make sure to check all the credits when I file.

Do you know if there are any deductions we can take related to job searching while on unemployment?

Job search expenses used to be deductible but they eliminated most of those deductions in recent tax law changes. You'd need to check current IRS rules.

I totally agree. It feels like being kicked when you're already down.

I understand the frustration, but unemployment benefits are considered income replacement, so they're treated like wages for tax purposes. It's been that way for decades.

Still doesn't make it right. People are already dealing with job loss and financial stress.

It's taxed as ordinary income, so whatever your regular tax bracket is. There's no special rate for unemployment benefits.

Got it, thanks. So it just gets added to my other income and taxed at my normal rate.

Oof, that's a big tax bill. I definitely should have done the withholding.

Yeah it was painful. Now I always choose the 10% withholding option when I file weekly claims.

Good to know for future reference, hopefully I won't need unemployment again but if I do I'll remember that.

The 1099-G includes any overpayments that were later recovered, plus it might include the extra $300 weekly payments if you received any of those. Check your payment history carefully.

Oh right, I forgot about those extra payments early in the year. That probably explains the difference.

If you're still not sure, you can call Washington ESD to verify the amount, though you might have better luck using a service like Claimyr to get through to them quickly.

Exactly! It's really not that complicated once you understand that unemployment is just treated like any other income for tax purposes.

Perfect, thanks! Now I just need to find all my other tax documents.

That sounds complicated. Did you need professional help with that?

I ended up using tax software that handled multi-state returns. It was actually easier than I expected.

Those articles are probably referring to the 2020 tax year when there was a temporary exclusion. For current tax years, all unemployment benefits are taxable income.

Ah okay, that makes sense. Thanks for clarifying!

Yeah, be careful with online tax advice - a lot of outdated information floating around from the pandemic years.

You should use the 1099-G amount since that's what Washington ESD reported to the IRS. If you think it's wrong, contact them to get a corrected form rather than using a different number.

That makes sense. I'll try to get through to Washington ESD to verify it.

If you can't get through their regular phone lines, try Claimyr - it's been a lifesaver for actually reaching Washington ESD agents when I need to resolve issues like this.

Same here! This was really helpful. Good luck with your taxes everyone!

Yeah this thread should be pinned for tax season. Lots of good info here.