- IRS Tax Topic 418: Unemployment Compensation
- IRS Publication 525: Taxable and Nontaxable Income
- 2015 Form 1099-G
Why YOU Should Care
If you receive unemployment compensation during the year, the amounts may be fully taxable on your Federal and State tax returns. You can either have the money withheld as it is paid out to you or make quarterly estimated tax payments to cover the income. Either way, you need to budget for the taxes you may owe on the money received.