Question Regarding $10,200 Unemployment Credit

[bchbumnj]

I filed our 2020 taxes prior to the President signing the bill. This was done so we could receive a stimulus check for our daughter that was born in 2020. At the time we owed the IRS roughly $300. I did collect over $10,200 in unemployment in 2020. With the first $10,200 now being waived, according to TurboTax I should be getting about $1,900 refunded. I know the IRS is going to be issuing refunds on the unemployment in May. Do we still have to pay this $300 in order to get the $1,900 refunded back to us? I have heard we should not amend our taxes and I'm worried that this 5/17 deadline will hit and nothing has happened and if I don't pay the amount due we'll get hit with late fees and penalties. I've reviewed our transcripts online and I haven't seen them make any adjustments for the unemployment. I'm just not sure if I'm supposed to pay the original tax that was due to get the $1,900 back or just sit, wait, and see what they do. Any advice or direction would be greatly appreciated. 

[CatinaT1]

I would not pay the amount due.  The IRS will take this into consideration when they determine your refund amount.

[Chalenger7]

I was unemployed last year for 10 months I filed my income tax on Feb 3. I never heard anything from Turbo tax  or IRS until April. At that  point the IRS said I owed $203. I was suppose to get a refund of $1597. I never got thru to IRS no matter how many times I called. I called Turbo Customer Service and they were no help at all. They told me to wait like the rest of us? huh  They were no help at all  I gave Turbo $50 for max benefits hoping they would check my return carefully   A few days later I checked with Walmart Tax person They told me IRS was going to delay payments until May because they were  not surprisingly over when I inquired about the exemption of  $10200 Now  I have to pay the $203  when they owe me money Otherwise I will get a late fee 

I will never use Turbo again 

Richard 

[Dfloresjr3]

How can I sign up for this

[Dfloresjr3]

I'm still waiting for my refund TurboTax rob me

[AmyC]

@Chalenger7  @Dfloresjr3  If you will not owe money when the IRS finishes adjusting your return, do not pay. The IRS only charges interest and penalties on amount due, not if you have a refund. The $1597+$203 = $1800 which would be the stimulus. If you already received it, then you would owe the $203 until they adjust for unemployment this summer. 

The IRS is having a tough time in processing and hard to contact, see this.  Each return must be cross checked for the normal and now with the new laws:

• stimulus- is it correct, pay missing amounts, do they need to be added for the new stimulus
• unemployment - is it on there, was it filed with the $10,200 subtraction, does it need to be adjusted
• premium tax credit - is it on there, is there an amount due, adjust the return
• EIC - is it on, were they banned, is there a record of release to claim?
• Child credit -anybody else claim, how old are kids, what is allowed
• Typos, offsets, and so on for still more, it is a long process this year to check each return for so many things.
• If there is a problem, you will get a letter explaining the issue.

The IRS is also processing returns mailed in last year and handling the current stimulus. They have scheduled this summer to adjust unemployment on returns.

The more items on your return, the more complicated the processing. Some people are getting their refund in two parts.

• Why do some refunds take longer than others?

• Blog post: Where's My Refund? Top 5 Reasons It's Been Delayed

[mentalraven131]

The transcript that you obtain from the IRS website is simply a copy of what you have submitted.  It will not reflect any adjustments that the IRS has made to your return.

[IfIWasARichGirl]

IRS has stated any refunds due to new unemployment exemption will start in May, with two phases of refunds to be expected. The first single filers, with second phase of refunds going to those married -filing jointly (and others with more complex tax situation) getting refunds during the summer. 

[AmyC]

You do not need to pay since the corrected version of your return is a refund. The IRS will begin processing those in May and you will receive the correct refund when they get to you.

If your tax return contains unemployment and a credit, the IRS will adjust both. See IRS to recalculate taxes on unemployment benefits; refunds to start in May  If your return has unemployment but you now qualify for an additional credit, then you should amend your return.

Here are some credits for which you may now qualify:

• Do I Qualify for the Credit for the Elderly or Disabled?
• Do I Qualify for the Retirement Savings Contributions Credit?
• What are the qualifications for the Earned Income Credit?
• What are Education Tax Credits?
• What is the Child and Dependent Care Credit?

In addition, you may need to amend your state return. See Do I need to amend my state return to update my unemployment?

Once your original return is accepted, you can file an amended return. 

• Save a copy of the original return before doing an amended return. See: 
  • how to file an amended return. The program will remove the $10,200 of unemployment and change things for you.
  • I need to amend my state return.
  • Can I e-file my amended state return?
  • Can I e-file my 1040X to amend my return?
• Track amended return status online. Taxpayers can track the status of their amended tax return in English and Spanish using Where’s My Amended Return?  Amended returns take up to 16 weeks to process and up to three weeks from the date of mailing to show up in the system.

[Tmcan255]

I filed few hrs ago and I was charged $355,  Tennessee state return   does not need, was charged MAX?? AND 200$ SELF EMPLOYED LIVE,  ANYWAY I CAN FIX THIS, I DIDNT KNOW WHAT I WAS DOING AT THE TIME , LAST YEAR WAS $115  FEES,