How much taxes are taken out of unemployment benefits in Washington?

Thanks! I think I did elect to have taxes withheld but I want to double check. Where exactly do I find that option in my account?

Go to 'Manage Tax Withholding' in your eServices account. You can start, stop, or change the amount there.

Oh no, that's exactly what I'm worried about! How do you figure out if 10% is enough?

You can use the IRS withholding calculator or talk to a tax professional. Generally if you were in the 22% bracket before unemployment, 10% won't cover it.

Yeah I wish I had known that earlier. Now I just set aside extra money each week to be safe.

I had the same issue last month! Turns out I needed to clear my browser cache and use Chrome instead of Safari. Also try accessing it early in the morning when fewer people are online.

If you're still having trouble getting through to Washington ESD, I recently found this service called Claimyr that helps you actually reach an agent. They have a website at claimyr.com and there's a demo video at https://youtu.be/7DieNd3C7zQ showing how it works. Saved me hours of calling and getting disconnected.

Thanks for the suggestion! I'm getting desperate trying to reach someone about this withholding issue.

So the entire amount I receive gets added to my income for tax purposes? Even though I already paid into the system through payroll taxes?

Yes, 100% of your unemployment benefits are taxable income. The payroll taxes you paid for unemployment insurance don't reduce the taxability of the benefits you receive.

This is so true! I was unemployed for 8 months and got a $1200 tax bill even with withholding. Now I always have them take out extra.

How much extra do you have them withhold? I'm trying to figure out what's safe.

I have them withhold 15% instead of 10%. It's better to get a small refund than owe money.

You need to fix this ASAP! Unemployment is definitely taxable. Log into your Washington ESD account immediately and elect to have taxes withheld, or start setting aside money for taxes.

Don't panic, but yes you'll owe taxes on every dollar you've received. Contact Washington ESD to start withholding going forward and calculate how much you should save from what you've already received.

Oh no, this is a disaster. I've spent everything I received. How am I supposed to come up with tax money now?

Good point! Where do I find a record of all my payments?

In your eServices account under 'Payment History' you can see all your benefit payments. Print or save a copy for your records.

That doesn't sound too terrible. Better than owing thousands!

Yeah, a couple hundred is manageable. It's the people who don't withhold anything that get shocked at tax time.

Same experience here! I was trying to get clarification on whether I could change my withholding mid-claim and never got through.

You guys should try Claimyr - it's a service that helps you get connected to Washington ESD agents without the endless hold times. I used it twice last month when I had questions about my claim status and it worked perfectly both times.

Is that legitimate? I'm always nervous about third-party services for government stuff.

Yeah it's legit, they don't ask for any personal info or passwords. They just help you get through the phone system faster. Check out their demo video to see how it works.

How did you set it to 15%? I thought the options were just yes or no for the standard 10%.

You're right, Washington ESD only does the flat 10%. I meant that I have them withhold the 10% and then I set aside an additional 5% on my own each week.

Oh that makes sense! Smart way to handle it.

This is exactly what happened to us. My husband kept working and my unemployment pushed our joint income high enough that we owed an extra $1500 at tax time.

I'm single so hopefully I don't have to worry about that complication.

Like what kind of credits? I usually get the earned income credit.

Earned Income Tax Credit has specific requirements about earned vs unearned income. Unemployment is considered unearned, so it might affect your eligibility depending on your total situation.

Exactly. It's worth talking to a tax professional if your unemployment situation is going to last most of the tax year.

Ouch, that's a lot! How long were you on unemployment?

About 9 months. I was getting around $600 per week and just didn't think about the tax implications until it was too late.

This thread is scaring me into double-checking my withholding election right now!

That's a great suggestion! I'll look that up right now.

The IRS tool is really helpful. It takes into account your other income, filing status, dependents, etc. Much better than guessing.

Was it worth it? I'm so frustrated with trying to call the regular number.

Definitely worth it for me. I had specific questions about how changing my withholding would affect my next payment and needed to talk to a real person.

Thanks for the follow-up! Good to know it actually works.

That's a really simple way to think about it. If I was having taxes taken out of my $55k salary, I should definitely have them taken out of unemployment benefits too.

Exactly! Treat unemployment income the same way you'd treat any other income source for tax purposes.