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Benefits are subject to federal income tax. At your request, we will withhold federal tax from your unemployment benefits. Federal withholdings are 10 percent of your gross benefit payment. 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. If you change addresses, you must give the VEC the new address to receive your 1099-G.

If you need to make estimated tax payments, see IRS Publication 505, Tax Withholding and Estimated Tax or see Form 1040-ES.