Please see the letter below from the NY State Society of CPA’s regarding the taxability of unemployment in the state:
The NYSSCPA Government Relations Team has been working non-stop to ensure your voices in Albany are heard as the legislature prepares to debate and pass the fiscal year state budget for 2021-2022.
Our team has gained much needed clarity on how the state will treat unemployment benefits — as taxable or not taxable income. We learned that late last night, the enacted FY 2021-22 New York State budget does not exempt the first $10,200 of Unemployment Compensation from NYS Personal Income Tax. It will, however, give the Commissioner of the Department of Taxation and Finance the authority to waive interest on any underpayment of taxes attributable to Unemployment Compensation for good cause shown.
The bill states “Notwithstanding the provisions of section 684 of the tax law, for good cause shown, the commissioner may waive interest on any underpayment of the tax imposed under article 22 or pursuant to the authority of article 30 or 30-A of such law for taxable year 2020 that is due solely to insufficient withholding of tax on unemployment compensation.”
The NYSSCPA Government Relations Team will continue to monitor the legislature’s progress in passing bills that will affect your business, clients and livelihoods.
Joanne S. Barry, CAE