Question

Unemployment Exclusion updates

Forum|Forum|5 years ago
March 25, 2021
2 replies
0 views

I have purchased CD version of TT

I have completed but not yet submitted my Federal and State taxes

I need to know when the software update will be included so that my proper unemployment will be reflected.

As of 3/25/21 --it still doesnt seem to be updated???

H

Hawk3m

I have same issue. Would like answer on this too since last we heard TT software was to be updated March 19th

Plus how do we handle State Taxes like CT will use the new AGI after $10200 exemption taken by IRS but if we have already filed and the IRS will handle changes to AGI (based on 1099G I guess) how will the state know of the update if no amendments need to be filed

RayW7

As soon as the IRS issues final instructions on how to report newly-exempt 2020 unemployment payments, TurboTax will make the necessary updates to its programs. Until those changes are made, you have two options:

1. File now and...there is no need to file an amended return (Form 1040-X) to figure the amount of unemployment compensation to exclude. The IRS will refigure your taxes using the excluded unemployment compensation amount and adjust your account accordingly. The IRS will send any refund amount directly to you.

2. File after IRS instructions are released and the programs have been updated.

From How will the third stimulus impact me?:

"We’re working hard to keep TurboTax up to date with the latest tax changes based on instructions we receive from the IRS. Check back soon to add your unemployment income and file your return."

H

Hawk3m

What about the State taxes not addressed in your reply

C

Cynthiad66

Each state is different. Some states tax unemployment and some do not. Some states will follow the federal lead and exclude $10,200.00 and some states will not. However, the good news is that TurboTax will roll the federal adjustment into the states returns and it will be handled appropriately.

The IRS, and most states, consider unemployment payments as taxable income, which means that you have to pay tax on these payments and report them on your return. With this new law, if your household income is less than $150,000, the first $10,200 of unemployment per taxpayer, will be tax free on your federal tax return, but any amount you receive above that will be taxed.

We are actively working to update the states to account for these new federal changes.

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