What is unemployment taxes - Washington ESD withholding confusion

Oh that makes sense! I must have accidentally selected withholding when I filed. Can I change it mid-claim?

Yes, you can change it anytime through your Washington ESD online account. Just log in and update your tax withholding preferences.

Yeah it's taxable income just like wages. You'll get a 1099-G form from Washington ESD in January showing how much you received. If you didn't have taxes withheld, you might owe when you file.

Ugh great, another surprise. I've been getting $450/week with no withholding for 3 months now.

Good point about saving. I'm terrible at saving money so maybe I should just let them withhold it.

I tried calling Washington ESD to change my withholding but couldn't get through. Spent 2 hours on hold yesterday before giving up.

You don't need to call for that - you can change it online in your account. Much easier than dealing with their phone system.

Never heard of that but might be worth checking out. I've been trying to reach them about my job search requirements for weeks.

Thanks for the tip! Though for tax withholding I think the online account should work fine.

How do you calculate that? I'm getting unemployment plus some part-time work income.

You'd add your unemployment benefits to your work income and see what tax bracket that puts you in. If you're close to a higher bracket, 10% withholding might not cover it.

This is getting complicated. Maybe I should just have them withhold and deal with any refund later.

Ouch! Did you have to pay penalties too or just the tax amount?

Just the tax amount since I filed on time. But it was a nasty surprise that wiped out my savings.

Yeah I've been reporting my part-time hours each week. They reduce my benefits but I still get something.

Make sure you keep good records of all income sources for tax filing. The 1099-G from ESD plus any W-2s or 1099s from other work.

It's because unemployment benefits are considered income replacement, not welfare. That's why they're taxable at the federal level.

still annoying though. one more thing to worry about when youre already stressed about money

That's what I'm thinking. Better to get a refund than owe money I don't have.

Same here. I'd rather overwithhold slightly than get hit with a big tax bill.

Good to know! So if I've already received several payments without withholding, those won't be adjusted?

Correct. You'd need to account for those payments when filing your taxes and possibly make estimated payments if you owe a lot.

No state income tax in Washington, so you only deal with federal taxes on unemployment benefits.

That's one good thing about Washington then! Thanks for clarifying.

How much does something like that cost? Seems like it might be worth it for complex issues.

I'd rather pay a reasonable fee than waste entire days trying to get through. Check out their site at claimyr.com - they explain how it works.

Totally agree. They should make it more prominent during the application process.

Yeah, I probably checked the withholding box without really understanding what it meant.

That's smart advice. I'll try to save a little extra each week just in case.

I learned this the hard way. Had withholding but still owed $300 because of other income during the year.

Yes, you can change it as often as needed through your online account. Just remember it only affects future payments.

Perfect, thanks! Good to know I have flexibility if things change.

Good to know there are options when their phone system is impossible. I'll bookmark that site.

The demo video at https://youtu.be/7DieNd3C7zQ shows exactly how it works. Pretty straightforward process.

Thanks everyone! This thread really helped clear up my confusion. I'm going to set up withholding and save a little extra to be safe.

Glad it helped! These tax questions come up a lot, especially for first-time unemployment recipients.

Will do! I'll make sure to keep track of all my payments throughout the year.

Smart approach. Better to be over-prepared than scrambling at tax time.