Unemployment Benefits in Response to COVID-19 Coronavirus

Update on 9/7/2021: The special COVID-related Federal unemployment benefit programs have ended as of September 4, 2021. If you have been receiving Pandemic Unemployment Assistance (PUA), Pandemic Emergency Unemployment Compensation (PEUC), or Federal Pandemic Unemployment Compensation (FPUC), the benefit week ending September 4 is the last week that benefits will be paid. You should file your claim for the week ending September 4 as usual, but after that those benefits will no longer be paid.

For more information about who is eligible for unemployment benefits and appeal rights, look at our page about regular unemployment programs.

If you have lost income, you may be eligible for more benefits from other programs like 3SquaresVT, fuel assistance, Reach Up or Supplemental Security Income (SSI). Be sure to update your income information if you are getting public assistance benefits. If you are living in subsidized housing, you should report your income change to your landlord (if you live in a subsidized building), or your housing authority (if you get rental assistance such as a Section 8 voucher).

Overpayments: The Department of Labor says I was overpaid unemployment benefits and I need to pay them back. What should I do? 

Do I have to pay federal taxes on my unemployment benefits?

Unemployment benefits are usually taxable income. However, because of the pandemic, the federal government will not tax the first $10,200 of 2020 unemployment benefits. See the IRS website for more information, a worksheet and forms.

You can ask the Department of Labor to withhold federal and state taxes from your weekly benefit. You will get a tax form (1099G) in the mail by the end of January that lists your unemployment income.

What about Vermont taxes?

Unemployment benefits are usually taxable income. For 2020 benefits, the state is also following the special federal tax rule above. Learn more on the Vermont Department of Taxes website.

More information about unemployment

For more information about who is eligible for unemployment benefits and appeal rights, look at our page about regular unemployment programs.

Updated: Sep 09, 2021