Washington ESD unemployment benefits - do you have to pay taxes on pandemic unemployment compensation?

I did get the 1099-G from Washington ESD but it shows way more than $10,200. So everything over that amount for 2021-2022 is taxable?

Exactly. The $10,200 exclusion was only for the 2020 tax year. For 2021 and beyond, all unemployment compensation is federally taxable income.

I wish I had known that at the time! I didn't realize it was an option when I was filing my weekly claims.

Yeah most people don't realize you can have taxes withheld. It's buried in the options when you're doing your weekly certification.

Thanks for the tip! I've been trying to call Washington ESD for weeks to get clarification on my 1099-G but can never get through.

How much does that Claimyr thing cost? Seems too good to be true.

It's worth checking out their site for pricing info. For me it was cheaper than hiring a tax professional to sort out my unemployment tax mess.

Yes, unemployment is federally taxable income even though Washington state doesn't tax it. Federal and state taxes are completely separate systems.

ugh that sucks. wish someone had told me that when i was getting benefits

This explains why my friend in California had to pay state taxes on unemployment but I didn't here in Washington.

Exactly right. Each state handles it differently but federal taxation is consistent across all states.

That's exactly the kind of situation where Claimyr helped me. Took forever to get through on my own but they connected me to someone who could resend my missing forms.

I might have to try that. I've called like 50 times and either get busy signals or get disconnected after waiting on hold.

You can also log into your SecureAccess Washington account and download your 1099-G directly from there if you can't get through by phone.

Oh great, another thing to worry about. How do I know if I'll owe penalties?

Generally if you owe more than $1,000 in taxes you might face penalties, but there are exceptions. Your tax software should calculate this for you.

Yeah the rules kept changing. I had to amend my 2020 return when they made the first $10,200 tax-free.

Same here! Filed early then had to amend later. What a headache.

Good point, I almost put it in the wrong section. TurboTax flagged it and asked me to double-check.

Yeah tax software has gotten better at catching these mistakes but you still need to be careful.

I tried that strategy for weeks with no luck. Finally used that Claimyr service someone mentioned earlier and got connected within a few hours.

Might have to try that myself. The hold times are ridiculous even first thing in the morning.

Thankfully I only dealt with Washington ESD but good reminder for people who moved around during the pandemic.

Yeah I got benefits from both Washington and Oregon when I moved. Had to track down forms from both states.

Thanks everyone for the help! Sounds like I need to bite the bullet and pay what I owe. At least now I know for sure.

If you can't pay it all at once, the IRS has payment plan options that aren't too bad. Better than ignoring it.

Good to know, I'll look into that if needed. Really appreciate all the advice from everyone!