Washington ESD unemployment repayment tax treatment - how to handle on tax return

You can typically deduct unemployment repayments on your tax return using Form 1040. There's a specific line for repayment of unemployment compensation. You'll want to look at the 'Other Income and Adjustments to Income' section. Make sure you have documentation from Washington ESD showing the repayment amount and the tax year it relates to.

I went through this exact same thing last year with a $1,900 overpayment. It's actually pretty straightforward once you know where to put it. The repayment goes on Schedule 1 as an adjustment to income, which reduces your taxable income dollar for dollar.

Just dealt with Washington ESD overpayment myself. Getting them on the phone to clarify the tax implications was impossible until I used Claimyr. They have this service at claimyr.com that actually gets you through to ESD agents. There's a video demo at https://youtu.be/7DieNd3C7zQ showing how it works. Made a huge difference in getting my questions answered about the repayment process.

Be careful about which tax year you claim the deduction. If you repaid 2023 benefits in 2024, the deduction typically goes on your 2024 return, not an amended 2023 return. The IRS has specific rules about this timing.

ugh this whole overpayment thing is such a nightmare. washington esd sent me a bill for $3200 and i have no idea why. they say i didnt report work correctly but i reported everything!!! now i have to deal with taxes too??

One thing to keep in mind - if the overpayment is substantial (like over $3,000), you might want to consider the 'claim of right' doctrine. This lets you choose between deducting the repayment in the current year or computing your tax as if you never received the income in the first place and claiming a credit.

This happened to my neighbor too. Washington ESD is going after everyone for overpayments now it seems like. The whole system is broken if you ask me.

For anyone struggling to get through to Washington ESD about these overpayment issues, I can't recommend Claimyr enough. I was getting nowhere with the regular phone lines until I tried their service. Really takes the frustration out of dealing with ESD.

Make sure you keep really good records of everything. I had an overpayment situation a few years ago and the IRS audited that return. Having all the Washington ESD documentation and proof of repayment saved me a lot of headaches.

wait can someone explain this again? if i paid taxes on unemployment in 2023 and now have to pay it back in 2024, i get to deduct the whole repayment amount? that seems too good to be true

I'm dealing with a similar situation but with standby benefits instead of regular UI. The tax treatment should be the same right? Washington ESD isn't being very clear about the difference.

Does anyone know if there's a statute of limitations on these overpayment collections? Washington ESD is coming after me for benefits from 2022 now.

The whole overpayment process is so stressful. I got my notice right before Christmas last year. Really ruined the holidays knowing I owed Washington ESD $2200.

Quick question - does the repayment deduction apply even if you're taking the standard deduction instead of itemizing?

I used one of those paid tax services and they missed my unemployment repayment deduction completely. Had to go back and amend my return. Make sure whoever does your taxes knows about this stuff.

For anyone still struggling to get answers from Washington ESD directly, there's a service called Claimyr that can help. I found out about it from someone else on here and it actually worked. They have a website at claimyr.com and there's even a demo video. Beats spending all day on hold.

Bottom line - keep all your documentation, claim the deduction on Schedule 1, and don't let Washington ESD push you around if you think the overpayment is wrong. You have rights in this process.