Yes, you can get a refund if taxes were withheld from your unemployment
If you received unemployment benefits and had federal income tax withheld from those payments, you may receive a refund when you file your tax return. The IRS treats unemployment as taxable income, and if too much was taken out, you get the difference back.
The refund amount depends on your total income for the year, your filing status, and how much tax was actually withheld versus what you owe. Some people who received unemployment in 2020 and 2021 also benefited from a special rule that let them exclude part of those benefits from taxable income, which sometimes created larger refunds.
You do not need to do anything special to claim this refund—it happens automatically when you file your return and report the unemployment income on the correct line of your tax form.
Key Takeaways
- Unemployment benefits are taxable income, and the IRS will refund you if more tax was withheld than you actually owe.
- You report unemployment on Form 1040, line 1a (federal unemployment) or line 1b (state unemployment), depending on the source.
- The refund timeline is the same as any other tax return—typically 21 days if you file electronically and claim direct deposit, longer if you request a check.
- If you did not have taxes withheld from your unemployment, you may still owe tax on it when you file, rather than receiving a refund.
- Unemployment received in 2020 and 2021 may have may have access to for a partial exclusion, which could increase your refund if you did not claim it on an earlier return.
How unemployment income affects your tax refund
The amount of your refund depends on whether the tax withheld from your unemployment exceeded your actual tax liability. If you had $3,000 withheld but only owe $1,500 in total tax, you receive $1,500 back. If you had nothing withheld and owe $1,500, you owe that amount instead.
Your total income for the year matters significantly. If unemployment was your only income and you are single, you may not owe any federal tax at all because the standard deduction covers it—meaning all withheld tax comes back to you. If you also worked a job or had other income, the unemployment is added to that, and your refund shrinks or disappears depending on your total tax bill.
State tax refunds work the same way. Some states tax unemployment, others do not. If your state taxes it and withheld state income tax from your benefits, you may receive a state refund separately from your federal refund.
Where to report unemployment on your tax return
Federal unemployment benefits go on Form 1040, line 1a. State unemployment benefits go on line 1b. The IRS sends you a Form 1099-G in January or February showing how much you received and how much was withheld. Use those numbers directly from the form.
If you received unemployment from multiple states, you will receive multiple 1099-G forms—one from each state. Report each one on the appropriate line of your return, or if you are using tax software, enter each separately as the software prompts.
Do not reduce the unemployment amount by the tax withheld. Report the full gross amount you received, and the withholding appears on a separate line of the form. The IRS calculates the refund by comparing total tax owed against total tax paid (including what was withheld from unemployment).
Timeline for receiving your unemployment tax refund
If you file electronically and request direct deposit, the IRS typically issues refunds within 21 days. If you request a paper check, allow up to four weeks. These timelines assume your return is accepted without errors or flags for review.
Returns claiming the 2020 or 2021 unemployment exclusion sometimes took longer to process because the IRS had to verify the calculation. If your return is selected for review, the refund may take several months. You can track your refund status using the IRS Where's My Refund tool on irs.gov, which updates every 24 hours after your return is accepted.
If you filed your return and it has been more than 21 days since acceptance, or more than four weeks since you mailed it, check the status online. The tool will tell you whether the refund is still processing, delayed, or issued.
The 2020 and 2021 unemployment exclusion and refunds
In 2020 and 2021, the IRS allowed people to exclude up to $20,200 of unemployment benefits from taxable income (per year). This meant that if you received $15,000 in unemployment in 2021, you could exclude all of it; if you received $25,000, you could exclude $20,200 and report only $4,800 as income.
Many people did not claim this exclusion on their original 2020 or 2021 returns because they filed before the rule was announced or did not know about it. If that applies to you, you can file an amended return (Form 1040-X) for that year to claim the exclusion retroactively and receive an additional refund.
The IRS has a limited window to process amended returns, and the backlog has been significant. If you are owed a refund from amending a 2020 or 2021 return, it may take six months or longer to receive it. You can check the status of an amended return using the IRS AMEND tool on irs.gov.
What to do if you did not have taxes withheld from unemployment
Some people choose not to have federal or state income tax withheld from their unemployment benefits. If that is your situation, you will not receive a refund—instead, you may owe tax when you file.
Whether you owe depends on your total income and filing status. If unemployment was your only income and it was less than the standard deduction for your status, you owe nothing. If you had other income or unemployment exceeded the standard deduction, you will owe tax on the amount over the threshold.
If you expect to owe when you file, you can still file your return on time. You then pay the amount owed by the tax deadline, or set up a payment plan with the IRS if you cannot pay in full. The IRS website has payment options including direct debit, credit card, and installment agreements.
Tracking your unemployment refund status
Use the IRS Where's My Refund tool at irs.gov/refunds. Enter your Social Security number, filing status, and the exact refund amount from your return. The tool updates every 24 hours and shows whether your return is received, being processed, approved, or issued.
If you filed by mail, allow up to two weeks for the IRS to receive and scan your return before it appears in the system. Once it shows up, the tool will give you an estimated date for your refund.
If your refund is delayed beyond the expected date, the tool will tell you why. Common reasons include a missing or incorrect Social Security number, a math error on the return, or a flag for review. If the tool says your return is under review, do not contact the IRS unless you receive a letter asking you to do so.
State unemployment refunds and timing
State refunds follow their own timeline and are separate from federal refunds. Some states issue refunds within two to three weeks of accepting your return; others take six to eight weeks. A few states do not tax unemployment at all, so you will not receive a state refund even if you had state tax withheld.
Check your state tax agency website for a refund status tool. Most state sites have a similar tool to the IRS Where's My Refund, though some require you to log into an account or provide your state ID number instead of your Social Security number.
If you moved to a different state after receiving unemployment, make sure your return is filed in the state where you lived when you received the benefits. Unemployment is taxed by the state that paid it, not by your current state of residence.
Frequently Asked Questions
Can I get a refund if I received unemployment but did not file a tax return?
You must file a tax return to receive a refund of withheld taxes. If you had tax withheld from unemployment but did not file, the IRS holds that money until you file. You can file a return for prior years at any time, and you will receive the refund once the return is processed.
What if my 1099-G shows the wrong amount of unemployment or withholding?
Contact the state unemployment office that issued the form and ask them to send you a corrected 1099-G. Once you receive it, file an amended return (Form 1040-X) with the correct amounts. The IRS will recalculate your refund based on the corrected figures.
Do I have to report unemployment if I only received a small amount?
Yes. All unemployment benefits are taxable income and must be reported on your tax return, regardless of the amount. Even $100 in unemployment must be reported. Failure to report it can result in penalties and interest.
Can I claim the 2020 unemployment exclusion if I already filed my 2020 return?
Yes. File an amended return (Form 1040-X) for 2020 to claim the exclusion. You have three years from the original filing deadline to amend and claim a refund. Processing times for amended returns are currently six months or longer due to IRS backlog.
Will my unemployment refund affect my benefits or other programs?
A tax refund is not counted as income for most benefit programs like SNAP or Medicaid. However, some programs do count refunds as assets if you receive them and hold them. Check with the specific program administering your benefits if you are concerned about how a refund might affect your case.