Unemployment benefits come with tax responsibility

Alabama News

HUNTSVILLE, Ala. – Ahead of receiving your first unemployment compensation payment, the Alabama Department of Labor requires recipients to select tax withholdings.

That means you have to include the funds received on your federal tax return.

“All unemployment compensation payments are taxed by the federal government but not by the state government,” said ADOL spokesperson Kelly Betts.

The state department of labor does not host the personal details necessary to file an accurate return on its website.

“You have to wait until you get your form 1099-G which will come from the Alabama Department of Labor,” said Betts. “We’re working on getting those printed out and mailed this month by February 1.”

The tax form will be mailed to your current address on file.

If there’s confusion or you never receive your 1099-G Betts said you will be able to request a new one online.

And the department says it recognizes the urgency in sending the forms in a timely manner.

But the tax filing start date has been postponed so ADOL is anticipating the documents will arrive ahead of time.

“I know people are anxious to get those tax returns in the works because they’re probably going to get a pretty decent refund. However, the IRS pushed the filing start date back to February 12. So that’s going to push that a little bit,” said Betts.

ADOL says there’s also a chance some unemployment recipients received an overpayment of benefits. It’s important to note arrangements must be made to pay that money back.

The department is encouraging those who are still having problems with their unemployment claims to call their appointment scheduling hotline at 1(800) 361- 4524.

Once you set an appointment ADOL says to make sure you keep your phone handy. The department will only reach out one time per scheduled call.

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