Five Important Facts About Your Unemployment Benefits by theyne

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									 IRS Tax Tips                                                                           February 11, 2010


Useful Links:                Issue Number:              IRS Tax Tip 2010-29
IRS.gov Home                 Inside This Issue
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                                 Five Important Facts About Your Unemployment
                                                    Benefits
                             Taxpayers who received unemployment benefits in 2009 are entitled to a special tax
News Essentials              break when they file their 2009 federal tax returns. This tax break is part of the
                             American Recovery and Reinvestment Act of 2009.
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                             Here are five important facts the Internal Revenue Service wants you to know about
News Releases                your unemployment benefits.

                                 1.   Unemployment compensation generally includes any amounts received
IRS - The Basics
                                      under the unemployment compensation laws of the United States or of a
                                      specific state. It includes state unemployment insurance benefits, railroad
IRS Guidance                          unemployment compensation benefits and benefits paid to you by a state or
                                      the District of Columbia from the Federal Unemployment Trust Fund. It does
Media Contacts                        not include worker's compensation.
                                 2.   Normally, unemployment benefits are taxable; however, under the Recovery
                                      Act, every person who receives unemployment benefits during 2009 is
Facts & Figures                       eligible to exclude the first $2,400 of these benefits when they file their
                                      federal tax return.
Problem Alerts                   3.   For a married couple, if each spouse received unemployment compensation
                                      then each is eligible to exclude the first $2,400 of benefits.
                                 4.   You should receive a Form 1099-G, Certain Government Payments, which
Around The Nation                     shows the total unemployment compensation paid to you in 2009 in box 1.
                                 5.   You must subtract $2,400 from the amount in box 1 of Form 1099-G to figure
e-News Subscriptions                  how much of your unemployment compensation is taxable and must be
                                      reported on your federal tax return. Do not enter less than zero.

                             For more information, visit IRS.gov/recovery.

The Newsroom
Topics                       Links:


Electronic IRS Press Kit             The American Recovery and Reinvestment Act of 2009: Information Center
                                     IR-2009-29, First $2,400 of Unemployment Benefits Tax Free for 2009
Tax Tips 2009
                             YouTube Videos:

Radio PSAs
                                     Unemployment Compensation - January 2010: English | Spanish
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