The unemployment amount for the worksheet is not reduced for the non-taxable portion of the unemployment.
We don't think this was changed with the exclusion of 10,200 under the CARES Act.
According to the IRS:
“Unemployment Compensation
You should receive a Form 1099-G showing in box 1 the total unemployment compensation paid to you in 2020. Report this amount on line 7.
Caution. If the amount reported in box 1 of your Form(s) 1099-G is incorrect, report on line 7 only the actual amount of unemployment compensation paid to you in 2020.
Caution. When figuring any of the following deductions or exclusions, include the full amount of your unemployment benefits reported on Schedule 1, line 7 (unreduced by any exclusion amount):”
IRS Source
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