FWIW unemployment benefits above $2400/yr are included in Federal gross wages and also taxed by most states.
So most of them will get a big surprise April 15, 2010.
Just like the people who bought cars through the Cash for Clunkers are in for a surprise.
“FWIW unemployment benefits above $2400/yr are included in Federal gross wages and also taxed by most states.”
of course, given that this bill is to extend benefits to nearly 2 yrs, unemployment income would be the only income within the past year for most. Given that, I urge you to look at where the breakeven point is for the IRS on income taxes once all the credits, deductions and exemptions are taken into account. The progressiveness of the current system is absurd and getting worse... want a preview of where all this is going? have a look at california... the state is so dependent on the wealthy for revenues that it faces wild swings due to capital gains and volatile income for the wealthy. Problem is, when times are good, they spend like drunken sailors, and when times are bad, they blame the massive deficit on republicans refusal to agree to higher taxes (as if 10.55% state income tax and 8%+ sales tax is not high enough). Its a good show, you should watch it some time ;)