Kalispell, MT CPA / Tony Ennenga CPA PLLC

If you received unemployment compensation in 2009, you are entitled to a tax break on a portion of those benefits thanks to the American Recovery and Reinvestment Act of 2009. Normally, unemployment benefits received from your state or the Federal Unemployment Trust Fund are fully taxable as income. In 2009, the first $2400 of the income can be excluded from income. Married couples are each eligible to exclude their first $2400 of unemployment benefits received. You should receive a Form 1099-G totaling the unemployment benefits paid in 2009. Simply subtract $2400 (don’t enter less than zero) from the amount in Form 1099-G, box 1 and enter it on your federal income tax return.