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How to Report Unemployment Compensation in TaxSlayer | 1040-SR (Web-based)
How to Report Unemployment Compensation in TaxSlayer | 1040-SR (Web-based)

Unemployment compensation is considered taxable income and must be included in gross income when filing a Form 1040 tax return.

Daisy Macapangal avatar
Written by Daisy Macapangal
Updated over 2 weeks ago

If a taxpayer received unemployment benefits during the year, they should have received Form 1099-G from the state unemployment office, which details the total amount paid.


Steps to Enter Unemployment Compensation in Tax Software

To properly report unemployment income on a tax return, follow these steps:

  1. Navigate to the Federal Section from the left-side menu.

  2. Select Income and locate Form 1099-G.

  3. Click Add or Edit a 1099-G and enter the details from the taxpayer’s Form 1099-G, Box 1.

Once entered, ensure that all details match the information provided by the state agency to avoid any errors or delays in processing the return.


Final Notes

✔️ Unemployment compensation is fully taxable unless specified otherwise by law.
✔️ Ensure that the Form 1099-G details are entered accurately to prevent discrepancies.
✔️ If any tax was withheld, report that information as well to properly calculate the taxpayer’s total tax liability or refund.

By following these steps, taxpayers can correctly report unemployment income and ensure compliance with IRS regulations.

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