Washington ESD unemployment benefits count as gross income - tax implications?

Oh wow, I had no idea. So if I'm getting $547 weekly that's like $28,444 annually if I stayed on benefits all year. That's going to be a big tax bill.

You can have taxes withheld from your weekly claims! When you file your weekly claim on the Washington ESD website there's an option to withhold 10% for federal taxes.

That's exactly what I'm worried about! How do I set up the tax withholding through Washington ESD?

When you do your weekly claim filing, there should be a question about federal tax withholding. Just select yes and they'll take 10% out of each payment automatically.

I had the same problem until I found Claimyr - it's a service that helps you get through to Washington ESD agents. Check out claimyr.com, they have a video demo at https://youtu.be/7DieNd3C7zQ showing how it works. Finally got my tax withholding question answered after weeks of trying on my own.

You can also check the Washington ESD website - they have tax information in their FAQ section that might answer your questions without needing to call.

No, SNAP benefits (food stamps) are not taxable income. Only the unemployment insurance payments from Washington ESD count as taxable income.

Good to know, thanks for clarifying that!

How do I calculate what I should be paying quarterly? This is getting complicated.

There are online calculators for estimated taxes, or you could talk to a tax preparer. Generally you want to pay at least 90% of what you'll owe throughout the year to avoid penalties.

Or just have the 10% withheld from your weekly claims going forward and make one estimated payment for what you've already received without withholding.

Yes, unemployment benefits typically count as income for most means-tested programs. Each program has its own rules though, so you'd need to check with the specific agency administering your benefits.

That's what I was afraid of. Might push me over the income limit for my health insurance subsidy.

I think it's because unemployment is supposed to be temporary so they want to give you the full amount to help with expenses. But yeah, it definitely catches people off guard at tax time.

Some states do automatically withhold taxes from unemployment benefits. Washington gives you the choice which is probably better since everyone's tax situation is different.

Good point. I did some freelance work last month and reported it on my weekly claim. Washington ESD reduced my benefit amount that week but I still need to pay taxes on both the unemployment and the freelance income.

Exactly! And make sure you keep track of all your income sources for tax filing. It gets messy fast when you have unemployment plus other income.

How did you finally get through to them? I've been trying for weeks!

I used that Claimyr service someone mentioned earlier. Worked like a charm - got connected to an agent within 20 minutes instead of calling for hours.

I keep seeing Claimyr mentioned on these forums. Is it legit or just another scam?

It's legit. I was skeptical too but it actually worked. Worth it just to avoid the endless busy signals from Washington ESD.

Oh no, I didn't think about that. My husband is still working full time. This could really increase our tax liability.

Yeah, definitely talk to a tax professional if your combined income is going to be significantly higher than usual. You might need to adjust your husband's withholding at work too.

All unemployment compensation is taxable regardless of which program it comes from. Regular UI, extended benefits, even trade adjustment assistance - it's all taxable income.

Thanks for clarifying. At least it's consistent across all the programs.

Is 15% enough? I'm worried 10% won't cover it if I'm in a higher tax bracket.

Depends on your total income for the year. 15% should cover most people but if you have other income sources you might need more.

You can always make additional estimated payments if needed. Better to overpay and get a refund than underpay and owe penalties.

Thanks everyone for all the helpful information. I'm going to log into my Washington ESD account right now and set up the tax withholding.

Smart move. Wish I had done that from the beginning instead of scrambling at tax time.

Good advice. I had an issue last year where my 1099-G was wrong and it took forever to get Washington ESD to issue a corrected form.

Exactly why it's important to keep your own records throughout the year. Makes it much easier to spot errors on the 1099-G when you receive it.

Definitely try Claimyr if you can't get through the regular way. Saved me so much time and frustration dealing with Washington ESD phone issues.

Will do, thanks for the recommendation!