Virginia Employment Commission Frequently Asked Question
Are my benefits taxable?:
Benefits are subject to federal income tax. At your request, we will withhold federal tax from your unemployment benefits. You will be mailed a statement, Form 1099-G, of benefits paid to you during the year. It is your responsibility to keep us informed of any changes in your address and to include unemployment benefits received on your annual tax return and pay the tax due.
Benefits you received that are determined to be overpaid and are repaid may be deductible. Contact the Internal Revenue Service or your tax advisor.