Things You Need To Know When Filing Taxes This Year With Unemployment


Monday, January 25th 2021, 10:37 pm
By: Erica Rankin


OKLAHOMA CITY -

The latest update from the state shows more than 39,000 Oklahomans are on unemployment, which is a significant drop from the height of the pandemic.

In the coming weeks, everyone affected will have to include all the benefits received over the year when they file their taxes.

"3.9 billion that's more than the agency paid out the entire decade preceding," said Shelley Zumwalt, the Executive Director of the Oklahoma Employment Security Commission.

The pandemic flipped hundreds of thousands of lives upside down. That left many Oklahomans with no choice but to file for unemployment.

"It is really important that you claim those benefits you received on your taxes,” said Zumwalt. “You will receive a 1099 form that the agency is printing and mailing out."

The 1099 will have all the benefits someone has received. Those are taxable and considered an unearned income.

Dr. Mary Sheets, a former accounting professor, said when filing that would affect someone's earned income tax credit or their refund.

"In 2020 they won’t qualify, or they will get a much lower refund if a majority of their earnings came from unemployment,” said Sheets.

But there's good news that came from the last stimulus package that was passed.

"In that package was included a provision for individual taxpayers to substitute their 2019 earned income for purposes of receiving the earned income credit and the so-called additional tax child credit,” said Sheets.

So, you will want to make sure you know your 2019 earnings to be able to get a larger refund.

If you need help filing taxes, you can visit www.okctaxhelp.org or Dr. Sheets at UCO to have your documents scanned in and filed.