Are Unemployment Benefits Taxable?
The Tax Reform Act of 1986 has made Unemployment Insurance benefits fully taxable. You will be furnished a statement, Form 1099UC or the equivalent, at the end of the year of benefits paid to you. The Internal Revenue Service will be given the same information.
You may choose to have 10% of your unemployment payment withheld for Federal Income Tax. You will be permitted to change a previously selected option. You may change this option by reporting to your Unemployment Insurance office. For more information about withholding or estimated tax, you can obtain a copy of Publication 505, "Tax Withholding and Estimated Tax," by calling your local IRS office.
The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.
Additional Employment Law for Employees Articles
- Who Is Liable For Unemployment Taxes In Mississippi?
- How Does An Employer Register With The Mississippi Employment Security Commission To Pay Unemployment Taxes?
- Where Can I Get More Information On Unemployment Taxes?
- What Determines My Benefit Amount?
- How Do I File An Initial Claim For Unemployment Benefits?
- What Can I Do If I Am Denied Benefits?
- What Will Happen If I Receive An Overpayment?
- Are There Work Restrictions For Minors?