Here is an example of how Turbo Tax and/or the IRS can include the exemption of unemployment benefits by updating and adding a new simple Worksheet Form. When determining the taxable income from 1099G, start with Box 1 the gross amount (i.e. 19,500) then answer a question for which State, Box 2 subtract the Exempt Amount ($10,200) and Box 3 Total Taxable Amount (i.e. $9,300) to report on the applicable tax return. Basically, it's a no brainer. The entire tax code is filled with hundreds of worksheets. This would be the quickest way to update the programs and avoid any further delay for people to file as soon as possible. Although it's simple mathematics to all of us, a worksheet has to be saved in the tax file for legitimate reference. By simply subtracting $10,200 you can delay the processing of your return because the IRS computers have to be updated to avoid spitting out letters of unreported income. That's the only reason the IRS CODE has to be revised. However, the IRS knew it was coming and should have been ready to roll as soon as the President signed the bill. And, bottom line it's only for 2020 tax year.
