Does Washington have unemployment tax on benefits received?

Oh right, I forgot Washington doesn't have state income tax! So just federal taxes then. I haven't gotten my 1099-G yet though.

The 1099-G forms usually come out in late January. You can also access it online through your SecureAccess Washington account if you need it sooner.

I think I had the option to withhold taxes but didn't do it because I needed every dollar at the time. Probably should have though.

Same mistake I made. Ended up owing like $1,200 in federal taxes on my unemployment benefits. Definitely get that 1099-G and plan accordingly.

How much does that cost? Seems like it might be worth it if Washington ESD is being slow with the tax forms.

It's pretty reasonable for what you get. Way better than spending hours trying to get through on your own. The agent I talked to was able to tell me exactly when my 1099-G would be mailed.

I know it seems unfair, but unemployment benefits have always been considered taxable income by the IRS. The only exception was in 2020 when they waived taxes on the first $10,200 due to COVID.

ugh that sucks. so if I got $15000 in unemployment I have to pay taxes on all of it?

Yes, the full amount is taxable income. But remember you can still take standard deductions and other deductions that might reduce what you actually owe.

Wish I had known this earlier! I was so focused on getting the maximum weekly benefit amount that I didn't think about taxes.

You can actually change your withholding election anytime during your claim. Just log into your Washington ESD account and update your preferences.

That sounds about right depending on your other income and tax bracket. At least in Washington we don't have to worry about state taxes on top of it.

True, could be worse. I'm just trying to figure out payment options since I don't have $1,800 sitting around.

Job search expenses used to be deductible but the Tax Cuts and Jobs Act eliminated most of those deductions for regular employees. You'd need to ask a tax professional about your specific situation.

I asked my tax guy about this last year and he said no, can't deduct job search costs anymore unless you're self-employed.

The 1099-G shows the gross amount you received. If you had taxes withheld, that will be shown separately in box 4 of the form.

Perfect, that's what I thought but wanted to confirm. Thanks!

Check your online account first. Sometimes the mailed versions get delayed but the electronic version is available sooner.

If you can't find it online either, definitely call Washington ESD. I used Claimyr to get through quickly when I had a similar issue. Way better than sitting on hold for hours.

Good idea, I'll check online first. If that doesn't work I might try that Claimyr thing.

This is really important. I got caught off guard by this when I had unemployment for half the year then got a new job. Ended up owing way more than expected.

That's exactly why I always have taxes withheld from unemployment. Better to get a small refund than owe a bunch.

How do you set up a payment plan with the IRS? Is there a fee for that?

You can set it up online at IRS.gov. There's a small setup fee but it's worth it if you can't pay the full amount right away.

Exactly right. Washington has no state income tax, so you only owe federal taxes on the unemployment benefits. The 1099-G will show the total amount you received, and you'll report that as income on your federal tax return.

Don't forget that even though you owe taxes on it, you can still take your standard deduction and other deductions to reduce your taxable income.

That's smart. I wish I had done that instead of being surprised by the 1099-G amount.

Yeah, it really helps with budgeting too. You can set aside a little each month for taxes instead of getting hit with a big bill.

Is it legit? Seems too good to be true that they can get you through to Washington ESD that fast.

Yeah it's real. They basically call for you and wait on hold, then conference you in when an agent picks up. Check out their demo video if you want to see how it works.

Glad we could help! This stuff can be confusing when you're dealing with unemployment for the first time.

Seriously, this thread answered all my questions. Now I just need to wait for my 1099-G and start planning for the tax bill.