Is unemployment taxable income - Washington ESD tax questions

Oh great, I think I remember that screen but probably just clicked through it. Do you know how to change the withholding setting?

Log into your Washington ESD account and look for tax withholding options under account settings. It's pretty straightforward once you find it.

Yikes that's exactly what I was afraid of. I've probably received around $8000 so far so I could be looking at over $1000 in taxes.

Yeah probably somewhere in that range depending on your other income. Better to start planning now than get hit with it all at once in April.

Thanks for the tip! I hate trying to call Washington ESD, it's always busy or I get disconnected.

Never heard of that service but anything that helps get through to ESD sounds useful. The phone system is terrible.

Good point, I'll make sure to watch for that in the mail. Do they also send it electronically?

Yes you should be able to access it through your online account as well, usually available by late January.

There was a special exemption for 2020 only where the first $10,200 of unemployment wasn't taxable, but that was just for one year. Regular unemployment has always been taxable otherwise.

ah ok that makes sense, i was getting confused about all the different rules

That's actually a really smart idea. I could probably set up an automatic transfer through my bank.

I did something similar and it saved me from a huge tax bill. Even if you only save 10% it helps a lot.

Yeah the whole system could be more user-friendly. There's so much important info buried in fine print or mentioned once and never again.

Exactly! I feel like this should be highlighted more prominently during the application process.

How do you figure out how much to pay quarterly? That sounds complicated.

There are calculators online or you can talk to a tax preparer. Generally it's based on what you expect to owe for the whole year divided by 4.

That's great that you got through! For anyone else struggling with the phone wait times, that Claimyr service I mentioned earlier really does help. Much less frustrating than sitting on hold for hours.

Yeah I'll definitely keep that in mind for next time. The hold time was ridiculous.

Good point, I'll have to look into that when I do my taxes. Every little bit helps.

I get the frustration but unemployment is basically replacing your wages which would have been taxed anyway. At least with withholding you don't have to think about it.

I guess that's true but it still sucks when you're already struggling financially.

That's good to know as a backup option. Hopefully I can get my withholding sorted out and avoid that situation.

Yeah exactly, I'm going to get this fixed ASAP. Thanks everyone for the helpful info!

No problem! These kinds of discussions are so helpful because the official info is often confusing.

Oh interesting, like what kind of expenses?

Things like resume printing, travel to interviews, professional networking events. Not huge amounts usually but every deduction helps.

The reason it's optional is because some people need every dollar of their unemployment benefit to survive. Automatic withholding could cause real hardship for some folks.

thats a good point i hadnt thought of that angle

Good to hear another positive review. I'm definitely going to check it out if I can't get through on my own.

Absolutely, that's exactly what I needed to hear. Time to take action instead of worrying about it.

This whole thread has been super helpful. I'm in a similar situation and now I know what I need to do.