Taxes on my unemployment received in 2020

  • I filed my taxes in 2020 and reported 7500 in unemployment income.  Did I pay taxes on that amount?
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mbelyue
Returning Member

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The IRS, and most states, consider unemployment payments as taxable income. This means that you have to pay tax on these payments and report them on your return. With the new American Rescue Plan, if your modified adjusted gross income is less than $150,000, the first $10,200 of unemployment will be tax free, per taxpayer on your federal return, but any amount you receive above that will be taxed.

JordanK_EA
Expert Alumni

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Hi @Tangerine59!

 

As part of the American Rescue Plan, the first $10,200 worth of unemployment payments are now tax-free for a person with an annual modified adjusted gross income of less than $150,000. So, if you filed before the bill was passed in mid-March, then you more than likely paid taxes on that amount (although your AGI does matter here, because if it was low enough, you may not have paid any taxes).  In this case, the IRS will automatically send the refund, if the adjustment did not affect other areas of your tax return. The IRS has been making adjustments on tax returns and issuing refunds all summer.  If you have not received your refund yet, the IRS has said that they will continue to send refunds throughout the summer which doesn’t officially end until September 22nd.

 

However, if you filed your taxes after the bill was passed and the software was updated to reflect the bill, then the exclusion was already accounted for with your income, and you wouldn't have paid any tax on that amount of Unemployment Income. 

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