Unemployment compensation is taxable income. If you receive unemployment benefits, you generally must include the payments in your income when you file your federal income tax return.

Check If Your Unemployment Compensation Is Taxable

Some types of unemployment compensation are taxed differently based on the program paying the benefits. Use our Interactive Tax Assistant tool to see if your unemployment compensation is taxable.

For more information, see Publication 525, Taxable and Nontaxable Income.

Report Unemployment Compensation

You should receive Form 1099-G, Certain Government Payments, showing the amount of unemployment compensation paid to you during the year.

To report unemployment compensation on your 2021 tax return:

If you received unemployment compensation but didn't get Form 1099-G in the mail, find the amount of your payments on your state unemployment agency website.

Exclusion for Tax Year 2020 Only

You can exclude unemployment compensation of up to $10,200 for tax year 2020 under The American Rescue Plan Act of 2021. See Exclusion of up to $10,200 of Unemployment Compensation.

Find more information:

Pay Taxes on Unemployment Compensation

To pay tax on unemployment compensation, you can:

Not sure which is best for you?

Report Unemployment Fraud

If you receive Form 1099-G showing the wrong amount of unemployment compensation, contact your state unemployment agency to correct it. If you believe someone fraudulently collected unemployment payments using your information, take these steps to report it and protect yourself.

Find more information about identity theft and unemployment benefits.

More Information