(Radio Iowa) – Democratic Congresswoman Cindy Axne is sponsoring legislation that would exempt some unemployment benefits from income taxes.

The bill would waive federal income taxes on the first 10-thousand-two-hundred dollars of unemployment benefits someone received in 2020. Axne says a lot of people covered by unemployment insurance often don’t realize they have to pay taxes if they receive benefits.

In addition to traditional unemployment benefits managed by states, the federal government created two other unemployment programs during the pandemic and the bill covers all three forms of unemployment. Illinois Senator Dick Durbin is sponsoring a similar bill in the Senate. Axne says she hopes the proposal is added to the pandemic relief package that President Biden is negotiating on with congress.

Axne says it that route doesn’t work, the bill should get a hearing soon in the House Ways and Means Committee. The 10-thousand-two-hundred dollars cited in Axne’s bill is equal to the extra six-hundred dollars congress provided in weekly unemployment benefits last year — during a 17-week period.