# U.S. Taxes - Unemployment income?



## Madonna

My son was laid off last year and collected unemployment here in Canada. How would he indicate that on his tax return? And how would he get credit for the Canadian tax he paid on the unemployment income - which deduction would he be entitled to?


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## Bevdeforges

According to Pub 17 (very handy - download a copy if you can), unemployment benefits go on line 19 of form 1040, line 13 of 1040A or line 3 of 1040EZ. 

Assuming that your son is filing a 1040 so that he can claim the FEIE on what he earned before being laid off, he would then claim back income taxes paid on his unemployment income on a form 1116.
Cheers,
Bev


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## Madonna

Bevdeforges said:


> According to Pub 17 (very handy - download a copy if you can), unemployment benefits go on line 19 of form 1040, line 13 of 1040A or line 3 of 1040EZ.
> 
> Assuming that your son is filing a 1040 so that he can claim the FEIE on what he earned before being laid off, he would then claim back income taxes paid on his unemployment income on a form 1116.
> Cheers,
> Bev


Thanks a lot, Bev. I couldn't find how to file unemployment benefits in all my research. Guess I just didn't know where to look. I'll download Pub 17!


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## Vangrrl

Bev beat me to answering this. 

But I'll just confirm that this is what I did. I was on maternity leave in 2008 and was paid EI benefits. My accountant declared the income and claimed the taxes back on 1116.


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## Peg

There may also be an exempt amount for EI. e.g., you received $6,000 in EI but the first $2,000 does not have to be reported. That was the case for one year that I filed (maybe 2009?)


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## Bevdeforges

Peg said:


> There may also be an exempt amount for EI. e.g., you received $6,000 in EI but the first $2,000 does not have to be reported. That was the case for one year that I filed (maybe 2009?)


Not the case, as far as I know. You have to report it all (for the US tax returns, at least) - but, depending on just how much you received in unemployment, the personal exemption and the standard deduction may take your tax liability down to 0 or so and it may not be necessary to claim the tax credit on the 1116 form.

Publication 17 is your friend, here. (Don't get overwhelmed by it - you can skip everything that doesn't apply.)
Cheers,
Bev


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## Madonna

Bevdeforges said:


> Not the case, as far as I know. You have to report it all (for the US tax returns, at least) - but, depending on just how much you received in unemployment, the personal exemption and the standard deduction may take your tax liability down to 0 or so and it may not be necessary to claim the tax credit on the 1116 form.
> 
> Publication 17 is your friend, here. (Don't get overwhelmed by it - you can skip everything that doesn't apply.)
> Cheers,
> Bev


Thanks, Bev! I've already downloaded it and will check it out. My tax situation is pretty simple, but my two sons are a bit more complicated. Thus the questions about unemployment benefits and RRSP withdrawals. Since they were both so young when we moved to Canada, I feel responsible for getting them straightened out with the IRS as well as myself and am doing the research for the three of us. Thank you so much for all your help!


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## Peg

Bevdeforges said:


> Not the case, as far as I know. You have to report it all (for the US tax returns, at least) - but, depending on just how much you received in unemployment, the personal exemption and the standard deduction may take your tax liability down to 0 or so and it may not be necessary to claim the tax credit on the 1116 form.
> 
> Publication 17 is your friend, here. (Don't get overwhelmed by it - you can skip everything that doesn't apply.)
> Cheers,
> Bev


2009 - Form 1040 - Line 19: *Unemployment compensation in excess of $2,400 per recipient** (see page 27) .* 

From page 27 of http://www.irs.gov/pub/irs-prior/i1040--2009.pdf *"Report on line 19 the part, if any, you received that is more than $2,400.*

When I completed for 2009, my EI was less than the $2,400 so I input 0 on Line 19 and remember that I read it a few times to make sure I completed it correctly. 

I only had EI for 2009 and 2010 so do not know about prior years.


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## Bevdeforges

Thanks for pointing that out! Not sure if that's a new provision since I last had unemployment income (years ago) or if I missed it. I did report the unemployment income, and wound up paying 0 taxes on it anyhow. I suppose this is where "Reading the Fine Manual" comes in handy. (The "fine manual" being pubs 17 and 54, BTW.)

Cheers,
Bev


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