unemployeement

[Bill2430]

I work and had to draw unemployment in the state of Illinois, however I live in Iowa and have to pay Iowa state tax.  I paid out of my unemployment 10% federal and 5% state (Illinois).  How do I file for the state to show in Iowa?

[MaryK4 · Accepted solution]

You will have to file a nonresident Illinois state tax return to report the income to Illinois.  When you file the Iowa tax return, as a resident you will report the income but then claim a credit for the tax paid to Illinois.  Unlike the Reciprocity agreement for the income wages, the unemployment does have to be filed with Illinois.