I have a question about tax on unemployment income -- Will unemployment benefits tax have ramifications on my refund?
Regarding unemployment benefits tax, unemployment benefits are taxable income. If your income goes up because you receive unemployment, your tax liability, due to tax on unemployment income, can go up, too. This means your refund will be lower or you'll owe more taxes -- Unless you covered the increase for tax on unemployment income by either:
- Withholding from your unemployment benefits
- Paying estimated taxes
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So how much will you get (or owe) this year? That’s the million-dollar question. We happen to have three very useful calculators to help you estimate your refund or balance due.