If you have recently received unemployment benefits, it’s important to understand that these benefits are taxable. Unemployment benefits must be reported on your federal tax return. A record number of Americans are applying for unemployment compensation due to the COVID-19 Outbreak. If you received unemployment benefits, as well as the additional $600 per week in coronavirus relief any time during the year, your tax return may be affected.
This additional income could drastically change your tax situation. Don’t get caught off guard when you prepare your 2020 taxes. If you did not have taxes withheld from your unemployment benefits, there are steps you can take now.
Review this important information provided by the IRS or contact your local unemployment office.