Hello, my company is closing in January and of course I will be filing for unemployment benefits, however I was wondering is it better to have them take the taxes out the checks right away, or deal with it when I file my taxes in the beginning of the year.
Thank you everyone .... this give me something to think about. .....TO MOMOF4, IF MY COMPANY IS CLOSING ... THAT PROBABLY MEANS I'M GETTING LAID OFF AND WILL BE UNEMPLOYED (NOW LETS USE SOME COMMON SENSE) SO THEREFORE IF I'M UNEMPLOYED, I CAN FILE UNEMPLOYMENT BENEFITS UNTIL I FIND A JOB... (THAT'S WHAT IT'S FOR) NOW IN ORDER TO GET MY SEVERANCE PACKAGE I HAVE TO STAY UNTIL JANUARY THEREFORE IT ONLY MAKES SENSE TO START LOOKING, WHEN IT GETS CLOSER TO JANUARY... B/C WE ALL KNOW THE ECONOMY IS HORRIBLE AND FINDING A JOB QUICKLY ISN'T EVEN HEARD OF ANYMORE... SO YOUR COMMENT ABOUT "HOPE YOU'RE NOT MILKING THE SYSTEM PLEASE STICK THAT UP YOUR ... (YOU KNOW THE WORD)
TAKE THE TAXES OUT NOW!!!!!
I realize that unemployment benefits are NOT that much - however, it makes a BIG difference at the end of the year - much less hassle having them take it out NOW...
Sorry to hear you company is closing!! if they are giving an severance package - is this why you are staying? I personally would start looking for a new job now....
Why are you planning on what to do with your unemployment benefits when you have a half a year to find another job? It sucks that they are closing but I am not to keen on supporting you if you don't even try to find another job. :(
Texas has one of the lowest unemployment rates in the country for a reason.
Unless you are a great saver, always withhold.
not sure what your financial situation is...if you are strapped for money - then the $25 to $40 they take out may hurt you...don't know if you own a home or not so don't know if you have other "off-sets" , i.e. mortgage interest, etc. that will make up the difference in the end...
Don't know if you are a saver and can put aside the money - especially if you typically owe taxes...
IF the company isn't offering me a nice severance package - I would start looking for a job NOW....you have six months to find a new job and Texas has the lowest unemployment rate in the Nation....
It really is a personal preference. The maximum amounts allowable for unemployment varies greatly state-by-state, and I don't know what the max is for Texas, but in Delaware it's $330/week. What that means is that they would withhold aprox. $30/wk for taxes. Now, when I was on unemployment a few years ago & only getting $330/wk, that $30 really makes a big difference week by week, but almost nothing at the end of the year as we've got 2 kids plus mortgage interest to write off on our taxes. It didn't make me owe anything at the end of the year, we just got back a little bit less than usual.
When I was laid off a few years ago, I had them take the taxes out because I knew it would affect out year-end and I wouldn't miss it all that much AND i knew I wouldn't "save" for it.....completely up to you, but that's what I did. It worked best for us.
Texas prides itself on having the lowest unemployment in the US
unemployment was established as a precautionary not a 'my company is closing and of course I will be filing for unemployment benefits', hope you're not milking the system as 6 months to find a job is quite a bit of time.
If you MUST file for unemployment benefits then have taxes taken out
Let them take the taxes out so you don't have to worry about owing.
The only reason I didn't do the above is because I'm single filing head of household and I knew they'd already taken enough over the course of the year.
It's always best to live without that money and get a refund as opposed to owing.
Best wishes.
I just became employed again after almost a year - No I was not miking the system - the economy sucks and there have been up to 200 resumes submitted for every job that I interviewed for.
Anyhoo, because I was cash strapped I did not have taxes out. Look at your estimated total household income for 2011 vs allowable expenses and calculate if your expenses will be higher than the unpaid tax on the UE benefits. If so, you could safely forego the taxes until tax filing next year.
Also, you can deduct expenses related to job searching, non reimbursed medical expenses over 7% (check that number) of your adjusted income, interest paid on home mortgages, car tags, and a host of other common items. If you do any consulting or self employment work from your home you can also deduct a percentage of your home expenses as an expense.
I use turbo tax on line which walked me through all of this - then had a CPA friend check my return before I filed.
It is good to plan ahead and explore your tax liabilities before you decide.
Good Luck.
TAKE THE TAXES OUT!
I got burned because I forgot to click on the option.
Sucks that it's happening but at least you have time to prepare.
Good luck
I would have the taxes taken out since you are going to lose your job at the beginning of the year. I lost my job years ago in October and did not have them taken out, but then changed it in the new year to make sure there were no problems. Even then, when things were good, it was difficult to find a job. I also had to stick around until no less than 2 weeks before my end date to get my severance.
I live in tx as well and my sister has drawn unemployment a few times and they automatically took them out. I would think that would be better anyhow. You will be just fine mama! Its not" milking the system" when you honestly need a little help!
