What Does the New Unemployment Bill and Stimulus Mean for 2020 Tax Returns? Unemployment income
Normally, you would have to pay regular taxes on any unemployment benefits you’ve received, but the new bill gives a tax exemption to the first $10,200 of unemployment insurance received in 2020.
Details on how exactly to claim the exemption will become more clear after the IRS issues guidance to taxpayers.
If you filed jointly, and both spouses received unemployment benefits, the text of the law implies both spouses should each be able to claim the exemption.
If you already filed your tax return for 2020 and paid taxes on any unemployment benefits received, you can submit an amendment to get that money back. If you haven’t filed yet, you’ll be able to reduce your unemployment income by $10,200.
