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Joseph Leon
Joseph Leon, Labor and Employment Attorney
Category: Employment Law
Satisfied Customers: 438
Experience:  General practitioner, including labor & employment law; practiced 15 years; licensed in 4 states.
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Do I repot rental income to unemployment

Customer Question

I was recently laid off my job of seven years. During the time I was working I obtained a few rental properties. Do I have to report this income? If so do I report the gross amount I collect at the beginning of the month ($3160) or do I report what I net . The amount I net is $778 per month but the properties are not escrowed so it is actually less than that. If I have to report the gross I will not get any unemployment because I've been told they will deduct 80% of what I make each week. If I report the net I still won't be able to make a living but possibly have a little income until I find a job. I will end up losing everything I worked hard for! Will I have to payback unemployment? Will they arrest me or just send me a letter? I have never been to jail and I am scared! Please help me, PLEASE.
Submitted: 7 years ago.
Category: Employment Law
Expert:  Joseph Leon replied 7 years ago.
Is your question: Do you have to report it to the IRS or to the agency that is paying you unemployment benefits?
Customer: replied 7 years ago.
I report everything yearly to the IRS. I just have not to the unemployment benefits
Expert:  Joseph Leon replied 7 years ago.
The website requires that you report:

EARNINGS DURING LAYOFF. . . Be sure to include any wages earned during a
week that you are claiming--whether you've been paid or not. Remember, in
addition to regular wages, earnings include holiday and vacation pay, armed
forces drill pay, and self-employment income.

I'll look at whether that include rental income reported on schedule E.

Please respond to this message, because that puts you back on the to do list, and ensures I won't forget to respond.
Customer: replied 7 years ago.
Ok thank for checking on this for me. By the way I am on a permanent layoff the will not be reopening
Expert:  Joseph Leon replied 7 years ago.
I am posting the KY the statute that defines "wages" for purposes of determining eligibility for unemployment compensation. Link. Wages are defined as "remuneration for services." Rental income is not addressed, but it is remuneration for the right to occupy property, not for receipt of services. Of course, if the unemployment board asks you to list income, or anything other than wages, the rental income may be relevant.

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