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Level 2
posted Sep 9, 2021 10:52:14 AM

Will it benefit me the end?

Hello Experts, My question is will it benefit me if I check yes on the weekly claim form. The claim form gives me the option  to with hold federal taxes from my unemployment  weekly benefit, and if I check off the box for EDD to tax my unemployment funds it will immediately do so and I will not be able to reverse that action.  So when it's time to file my 2021 taxes How would this benefit me considering the EDD is a state supplement income.

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1 Replies
Employee Tax Expert
Sep 9, 2021 12:46:08 PM

Hello, @I2giveupsurrender , great question!

 

Usually, it is advisable to withhold taxes from your unemployment benefits so that you don't end up owing taxes at the end of the year. The good news is, if the withholding is more than what you end up owing for the year, you will receive a refund of the difference! 

 

Unless you are sure that you will not owe a tax balance next year (you can estimate here), I would suggest opting in to tax withholding.