Are Unemployment Benefits Taxable?

Unemployment benefits are subject to federal income taxes. Following the end of each calendar year, the New Jersey Department of Labor will provide you with a statement (Form 1099­G) of the total amount of benefits you received during the year. This information will also be given to the Internal Revenue Service (IRS).

To help offset future tax liabilities, you may voluntarily choose to have 10% of your weekly unemployment benefits withheld and forwarded to the Internal Revenue Service. If you wish to have federal income tax withheld from your weekly unemployment benefits, please complete and mail the "Instructions for Claiming Dependency Benefits and Requesting Federal Income Tax Withholding" form to your One­Stop Career Center (this form will be mailed to you after you file your unemployment claim).

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.

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