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What happens when taxes have been withheld for a unemployment check that have been determined to be overpaid?

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What happens when taxes have been withheld for a unemployment check that have been determined to be overpaid?

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Once an Unemployment payment has been processed, with Federal and State taxes withheld, the taxes withheld are immediately transferred to the respective agencies, on behalf of the claimant. Therefore, the only way to avoid having to repay the taxes withheld (if the week is determined to be overpaid) would be to return the actual Unemployment Insurance check. If the UI check is returned, we will notify the respective agencies to cancel the previous tax credit. If the UI check has already been cashed or processed through direct deposit, it will then be necessary for the worker to repay the tax credit already given, for which he/she was not entitled to, based on the overpayment determination.

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