The IRS solution to this unemployment exclusion is both elegant and klugey. Elegant in that no forms are changing; just the instructions for line 8 of Schedule 1. Klugey in that they are forcing a negative number to the "Part 1. Additional Income" section of the tax code (not very INTUITive). I'd be curious if TT allows a negative number, assuming they ask "any other income not reported already?" (Since I filed already, I can't play with the what/ifs).
I my case, with the reduction in AGI, both the Saver's credit and PTC eliminate my tax bill and my refund goes from $130 to $2,700. I am very curious if they'll make those adjustments automatically. This whole issue seems like unchartered territory for filers and the IRS. I've been doing my own taxes for 47 years and this is new to me for sure (unemployment being the main difference). I wonder if we have any ex-IRS employees or other tax experts out there that want to speculate.
