February 8, 2021
Workers who didn t withhold taxes from their unemployment benefits could have a bigger tax bill than they would normally.
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In 2020, the U.S. saw widespread joblessness and business closures making tax prep this year a bit complicated.
I’m not an expert, but we spoke with a lot of them, and asked: Will unemployment benefits be taxed? The simple answer is yes, said Mark Steber, chief tax information officer at Jackson Hewitt.
However, this only applies to people who didn’t choose to have taxes withdrawn from their benefits. Typically, not withdrawing doesn’t add up to a big tax bill. But this year could be different.