tax on unemployment?

With the recent additional income added to unemployment under the CARES ACT, many people found that their wages were fairly comparable to their normal pay or possibly a little more. A lot of people have been questioning if they need to pay taxes on those funds.

The answer is yes. Unemployment income is taxable. If you did not have any taxes taken out of your unemployment benefit, you could possibly see a bill at the end of the year. A recent study showed that 37% of Americans did not know that taxes need to be withheld from unemployment.

If you did not have anything withheld and are able to, try to set aside some of the funds you could potentially owe to help alleviate that burden at the end of the year. Otherwise you may need to enter into a payment arrangement with the IRS to pay back anything owed.


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