Question

2020 Unemployment Benefits

Forum|Forum|4 years ago
September 9, 2021
1 reply
0 views

In an email from you, Turbotax, there was an indication that we might be getting an adjustment to the taxation of the UI benefits, and this was in lieu of the 3rd stimulus check. Is that still the case? Have there been any official changes yet, or are we still waiting to see what they do?

N

newenglandpro

Hello!

In answer to your questions about another adjustment to the taxability of unemployment benefits the answer is congress is not planning another adjustment to the taxability of unemployment benefits at this time. Congress has no plans to provide tax benefits in lieu of a 3rd stimulus payment.

Rumors abound but there are no facts to support these two particular rumors.

As we all know anything can happen in the future and everything is negotiable in congress so there is always a possibility of a change tax and benefits.

Hope this helps! If not reach out to connect again for additional information!

B

BanArtAuthor

You said "additional" in talking about the relief. I'm talking about any initial relief from the taxation on the UI benefits I received in 2020 and claimed on my tax return.

I

ismailm615

Hi @BanArt

The American Rescue Plan Act of 2021, which became law in March, excluded up to $10,200 in 2020 unemployment compensation from taxable income calculations. The exclusion applied to individuals and married couples whose modified adjusted gross income was less than $150,000.

For most taxpayers, the IRS will adjust their tax return and send a refund for the unemployment compensation adjustment. In certain cases, an amended return is needed to get the correct adjustment. See the IRS article below.

https://www.irs.gov/newsroom/irs-continues-unemployment-compensation-adjustments-prepares-another-1-point-5-million-refunds

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