Is unemployment compensation subject to payroll taxes?

Answer 1

yes

Answer 2

Yes, its either taxed A) upfront each week by taking 10% off what your weekly amount would be ie: Your weekly amount is $400.00, you would only get $360.00 after taxes; or B) is untaxed as you receive it each week, but come the following tax season, you will have to pay the lump sum of taxes on all money you have received for that tax year.

Answer 3

There is no state income tax in Texas, so there is no state tax to worry about.

Benefits earned in 2008 are fully taxable for federal purposes.

The first $2400 of benefits per person is exempt from federal taxes in 2009.

If a couple files a joint return, the exemption for each person is figured separately.

Answer 4

The way this question was phrased is just TOO JUICY to pass up. Imagine, being out of a job, and finding out that the government wants to tax your LACK of income! I'm sure that's not what the question was, but rather "unemployment COMPENSATION" That clarifies a lot, knowing that it's compensation. The income tax that is levied upon you, is a compensation tax.

Additional information:In no state does the state (or the Federal government) charge the employee an unemployment tax or premium. They are always paid for by the employer through his payroll taxes, so that when the employer discharges a worker, without justifiable cause, the worker is protected against unfair job loss. That being said, unemployment benefits are income taxable, when combined with all other income received, with an exemption for a given minimum amount received as benefits.

Answer 5

Your state unemployment compensation payments do not come from your employer and they would not be subject to all of the payroll withholding taxes, etc that the employers payroll department is required to withhold from your gross pay.

It is subject to income tax when you file your income tax return at the end of the year that it is received in.

For the 2009 tax year the first 2400 of unemployment compensation that was received was free of income tax.

Answer 6

Yes. Whether taxes are actually due, however, depends on all the aspects of regular income reporting.

Answer 7

Yes - because it's classed as 'un-earned income'.

Answer 8

yes

Answer 9

Yes.