Iowa Unemployment Insurance

Iowa Workforce Development provides temporary assistance to workers who have lost their jobs or had work hours significantly reduced through no fault of their own. Funds used for unemployment insurance benefits compensation is paid by employers who are covered by the Iowa Employment Security Law. As of August 2016, Iowa unemployment was at 4.2 percent. Iowa Workforce Development distributes weekly benefits payments to individuals who meet state and federal eligibility criteria. 

Unemployment insurance is considered taxable income; it is not a welfare program. Claimants must report benefits received through the program on their state and federal income tax returns for the year. When you submit your initial application for unemployment insurance, you are given the option to have taxes withheld (10%) from your weekly benefits, should you be approved. You can change your mind about this option only once during the life of your claim.