{"id":22956,"date":"2024-12-09T14:22:54","date_gmt":"2024-12-09T19:22:54","guid":{"rendered":"https:\/\/blog.eztaxreturn.com\/?p=22956"},"modified":"2024-12-09T14:23:33","modified_gmt":"2024-12-09T19:23:33","slug":"tax-tips-for-the-unemployed","status":"publish","type":"post","link":"https:\/\/staging.eztaxreturn.com\/blog\/tax-tips-for-the-unemployed\/","title":{"rendered":"Tax Tips for the Unemployed: What You Need to Know"},"content":{"rendered":"\n

The information in this article is up to date for tax year 2024 (returns filed in 2025).<\/em><\/p>\n\n\n\n

In November 2024, the U.S. Bureau of Labor Statistics reported that 7.1 million people were unemployed. Losing your main source of income can be devastating. However, your new tax status may make you eligible for tax breaks reserved for those with lower incomes. Unemployment benefits contribute to an individual\u2019s adjusted gross income (AGI), and understanding your AGI is crucial for navigating tax obligations and qualifying for tax breaks. Here are some tax tips for the unemployed to help you maximize your refund and get through this rough patch.<\/p>\n\n\n\n

File Your Unemployed Taxes, Even If It’s Optional<\/strong><\/h2>\n\n\n\n

If you\u2019re single, under 65 and earned more than $14,600 in 2024, you must file a tax return.\u00a0 Even if you aren\u2019t required to file<\/a>, it may be worthwhile to do it anyway.\u00a0 You may be eligible for a refundable credit like the Earned Income Tax Credit (EITC)<\/a> which is worth up to $7,830 if you meet the qualifications.\u00a0 Refundable credits can produce a refund even when you don\u2019t owe taxes.\u00a0 Another reason to file your taxes is because if your previous employer deducted taxes from your pay, you may be able to get your money back.<\/p>\n\n\n\n

Do Your Taxes Early<\/strong> to Get Cash Sooner<\/strong><\/strong><\/h2>\n\n\n\n

When you’re unemployed, every bit of extra cash counts. Filing your tax return early could mean a refund that helps you stay afloat until your next job. The IRS says the fastest way to get your refund is by e-filing and choosing direct deposit to your bank account. If your tax situation is simple, you can file your federal return for FREE<\/a> with ezTaxReturn and get that refund in no time. Don’t wait\u2014file early and get the money you need sooner!<\/p>\n\n\n\n

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How Unemployment Benefits Can Impact Your Taxes<\/strong><\/h2>\n\n\n\n

Unemployment benefits are a vital source of financial support for individuals who have lost their jobs through no fault of their own. However, it\u2019s important to understand that these benefits are considered taxable income by the federal government and most states. This means that you will need to report your unemployment benefits on your federal income tax return and pay federal income taxes on the amount you receive. Failing to account for this can lead to an unexpected tax bill, so plan accordingly. Make sure to set aside a portion (aim for 10%) of your unemployment payments to cover any potential tax liabilities. Alternatively, you can ask to have taxes withheld or make quarterly estimated tax payments on your unemployment benefits.<\/p>\n\n\n\n

Claim All the Tax Credits You Can<\/strong><\/h2>\n\n\n\n

Depending on how much money you earned before becoming unemployed, you may now be eligible for tax credits you weren’t able to claim before.\u00a0 Here are a few you may qualify for:<\/p>\n\n\n\n