"Well, you abide by the tax laws in the state that you reside in. States with leaner unemployment compensation will tend to have lower taxes. If you live in one of those states, you will enjoy lower taxes."
Wrong. The taxation level for individuals has nothing to do with unemployment insurance payment amounts. I worked for the state employment service in Texas for 7 years. The manner in which UI funds are collected is standard across all 50 states because it is mandated by Federal law. The funds for unemployment insurance are derived from a payroll tax on employers. The individual worker pays nothing. The tax is a sliding scale percentage of the employer's total payroll. The sliding scale is determined by the employer's experience rate--i.e., companies that have few layoffs and few UI claims pay a lower tax rate than companies that have a lot of layoffs. If a company has a high rate, but then goes into a period of stability with few layoffs, that company's rate is lowered in subsequent years, but can go back up if layoffs and UI claims resume.
What varies from state to state is the amount that a worker can receive. Some states--like Texas--pay the Federally-mandated minimums. Others--like Massachusetts--include a welfare-like subsidy--i.e., are there dependent children in the home, etc. Such subsidies would and should come from state taxes. The Federally-mandated funds can be used to pay UI benefits to the worker and for nothing else and to no one else. The states can not even use part of the funds for administration of the UI program.
Also, you are paid according to the rates in effect in the state where you worked (officially). Doesn't matter where you live or where your paycheck is issued. I specified official work place because when I was at Texaco in the Information Technology Department we tried a work-from-home experiment. One of the participants lived in California but because of the wonders of technology, he worked at his home. However, his official work place was the IT office in Houston, TX. If he had been laid off, he would have been paid Texas UI rates, not California.
