If you lose your job, you may qualify for unemployment benefits. The payments may serve as much needed relief. But did you know unemployment benefits are taxable? Here are five key facts about unemployment compensation:

  1. Unemployment is taxable. You must include all unemployment compensation as income for the year. You should receive a Form 1099-G, Certain Government Payments by Jan. 31 of the following year. This form will show the amount paid to you and the amount of any federal income tax withheld.
  2. Paid under U.S. or state law. There are various types of unemployment compensation. Unemployment includes amounts paid under U.S. or state unemployment compensation laws. For more information, see Publication 525, Taxable and Nontaxable Income.
  3. Union benefits may be taxable. You must include benefits paid to you from regular union dues in your income. Other rules may apply if you contributed to a special union fund and those contributions are not deductible. In that case, you only include as income any amount that you got that was more than the contributions you made.
  4. You may have tax withheld. You can choose to have federal income tax withheld from your unemployment. You can have this done using Form W-4V, Voluntary Withholding Request. If you choose not to have tax withheld, you may need to make estimated tax payments during the year.
  5. Visit IRS.gov for help. If you're facing financial difficulties, you should visit the IRS.gov page: “What Ifs” for Struggling Taxpayers. This page explains the tax effect of events such as job loss. For example, if your income decreased, you may be eligible for certain tax credits, like the Earned Income Tax Credit. If you owe federal taxes and can't pay your bill, contact the IRS. In many cases, the IRS can take steps to help ease your financial burden.

For more details visit IRS.gov and check Publication 525. You can view, download and print Form W-4V at IRS.gov/forms anytime.

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September 2017
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Upcoming Tax Dates

September 5 — Everyone
Federal Holiday (Labor Day) Details

September 10 — Communications and air transportation taxes under the alternative method.
Deposit the tax included in amounts billed or tickets sold during the first 15 days of August.

September 11 — Employees who work for tips
If you received $20 or more in tips during August, report them to your employer Details

September 14 — Regular method taxes
Deposit the tax included in amounts billed or tickets sold during the last 16 days of August.

September 15 — Individuals
Make a payment of your 2017 estimated tax if you are not paying your income tax for the year through withholding (or will not pay in enough tax that way). Use Form 1040-ES. This is the third installment Details

September 15 — S Corporations
File a 2016 calendar year income tax return (Form 1120S) and pay any tax due. This due date applies only if you timely requested an automatic 6-month extension Details

September 15 — Partnerships
File a 2016 calendar year return (Form 1065). This due date applies only if you were given an additional 5-month extension Details

September 15 — Corporations
Deposit the third installment of estimated income tax for 2016 Details

September 15 — Social security, Medicare, and withheld income tax
If the monthly deposit rule applies, deposit the tax for payments in August.

September 15 — Nonpayroll withholding
If the monthly deposit rule applies, deposit the tax for payments in August.

September 27 — Communications and air transportation taxes under the alternative method.
Deposit the tax included in amounts billed or tickets sold during the last 16 days of August.

September 29 — Regular method taxes
Deposit the tax for the first 15 days of September.

September 29 — Regular method taxes (special September deposit rule)
Deposit the tax for the period beginning September 16 and ending September 26.

September 29 — Communications and air transportation taxes under the alternative method (special September deposit rule).
Deposit the tax included in amounts billed or tickets sold during the period beginning September 1 and ending September 11.

September 30 — Wagering tax
File Form 730 and pay the tax on wagers accepted during August.

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