Unemployment Compensation & State Taxes
There are two things you need to know when you have unemployment compensation income.
Unemployment compensation is taxable. Your unemployment compensation is taxable on both your federal and state tax returns.
You may be eligible for a deduction. You may be able to reduce or even eliminate any state tax due on your unemployment compensation. Be sure to complete the unemployment compensation deduction worksheet found in the income tax instruction booklet.
Below you will find some frequently asked questions and tips for next year if you continue to receive unemployment compensation in 2013.
If you have any questions, feel free to call the Department at (317) 232-2240.
Frequently Asked Questions
How can I file my state income taxes for free?
Does the Department have a payment plan option?
Where do I find information for estimated tax and getting an extension of time to file?
How do I contact the Department?
For more individual taxpayer FAQs, click here.
Planning for Next Year
If you continue to receive unemployment compensation in 2013, keep in mind the following tips to help plan and reduce your stress for next tax season:
- Keep track of possible deductions and credits you might be able to plan on.
- Put some money back to ensure you are able to pay your taxes in 2014.
- Find out how to pay estimated tax.
- Sign up with the Department of Workforce Development to have Indiana State and county tax withheld.
Stay Connected
- Find Indiana tax forms.
- Know when I will receive my tax refund.
- File my taxes as an Indiana resident while I am in the military, but my spouse is not an Indiana resident.
- Take the renter's deduction.
- Pay my tax bill in installments.
- Claim a gambling loss on my Indiana return.
- Have more time to file my taxes and I think I will owe the Department.
