If you’re experiencing unemployment, understanding how this status can influence your taxes is vital. The federal government regards unemployment benefits as taxable income, so anticipate those funds to be factored in during tax season. Your state will issue a 1099-G form detailing what you’ve received and whether taxes were withheld. If no taxes were withheld, you can request a 10% deduction from future payments. Severance pay is also taxed like your typical paycheck and included in your W-2. If the severance pay was a lump sum, it’s still considered as income for the year in question. This might temporarily shift you into a higher tax bracket, but only for the year you received it. Take into account all your income, including last paychecks, severance, and unused PTO when filing your taxes. Besides, a lower income might make you eligible for certain tax credits and deductions like Earned Income Tax Credit and Child Tax Credit. Remember to pay your estimated taxes if you’ve not had taxes withheld from your severance checks or if you’ve undertaken gig work.

For help during these challenging times, particularly if you’re in California, one resource you may find useful is contacting the Employment Development Department (EDD). EDD assists individuals in processing claims for unemployment, disability, and family leave services. In case you’re unsure of how to get a hold of Paid Family Leave or EDD for unemployment services, you can visit sites like eddcaller.com. They help provide guidance on getting through to live EDD representatives, thus allowing for more streamlined access to the unemployment services needed. When navigating through unemployment, every resource counts, and eddcaller.com is there to help bridge the communication gap between you and EDD.