Will Congress' recently approved tax waiver on up to $10,200 of unemployment insurance benefits apply to those who filed their returns but has not yet been processed?

[jmh_2000]

I transmitted my return, got my return accepted February 17, my "estimated federal refund date" was yesterday March 11th. Today upon checking the IRS Where's my refund tool, it tells me: "Your tax return is still being processed. A refund date will be provided when available."

When my return is processed, will my $10,200 of taxable Unemployment income be waived? Or will I file an amended return?

And lastly, if an amended return would have to be filed and I already received my refund as direct deposit will I be sent just the difference?

[MinhT1 · Accepted solution]

The new proposed bill is expected to exempt from taxation up to $10,200 of unemployment benefits received in 2020.

However, the bill is not enacted into law yet. Please be patient. When it becomes law, the IRS will provide guidance within two to three weeks on what taxpayers need to do. And TurboTax will always timely assist their customers.

[mgosswein2]

I am completing my daughters tax return for 2020 tax year and she is getting taxed on her unemployment income she earned in 2020. Why is that? Up to 10,200 should be non-taxable but my updated TurboTax Deluxe product does not reflect this. 

[DoninGA]

---

@mgosswein2 wrote:

I am completing my daughters tax return for 2020 tax year and she is getting taxed on her unemployment income she earned in 2020. Why is that? Up to 10,200 should be non-taxable but my updated TurboTax Deluxe product does not reflect this. 

---

The software is scheduled to be updated on 03/19 to include the unemployment compensation exclusion.

See this TurboTax support FAQ for information for the unemployment compensation exclusion - https://ttlc.intuit.com/community/tax-topics/help/how-do-i-claim-the-new-unemployment-benefits-in-tu...

Also see this IRS statement - https://www.irs.gov/newsroom/irs-statement-american-rescue-plan-act-of-2021

[Sugarboxerr01]

03/20/21

You stated that the software would be updated on 03/19/21 to reflect the new unemployment. I have printed my return to mail it but have not mailed it. So I opened my return but it still does not reflect the change- I went in to make sure my updates are all applied and they are. So do I need to start my return over from scratch to get it to reflect the change or is there a way to correct this return from here?

[VolvoGirl]

Are you using the Desktop program?  Only the Online version has been updated.  Keep waiting for the Desktop program to update.

[TomD8]

See this news story:

https://www.cnbc.com/2021/03/19/10200-unemployment-tax-break-irs-to-automatically-process-refunds.ht...

[Sugarboxerr01]

This news article does NOT state when Intuit will be updating the desktop version software with the updated unemployment tax break information. Why did you send me this article link? I obviously know the law and that it passed or I would not be asking for the update as well as you have already updated the online version so since I am using the desktop version I need to know a date that it is expected to update.

[macuser_22]

I am guessing that it will be in the scheduled 3/26 update.  I doubt very much that they will have a special update for one item and force everyone to download and update software twice in a few days of each other.

[fanfare]

@Sugarboxerr01 

the point of the article is that some people have already filed  and you will be in that category tomorrow if you file today.

IRS is saying they will handle it with no further action on your part.

[macuser_22]

---

@fanfare wrote:

@Sugarboxerr01 

the point of the article is that some people have already filed  and you will be in that category tomorrow if you file today.

IRS is saying they will handle it with no further action on your part.

---

However, there is no telling how long it will take the IRS to do that.     The IRS commissioner testified in Congress Thursday that they are going to "attempt" to do it on their own for already filed tax returns. No telling how long that will take.

Doing it yourself on yiu own tax rerun adds it to the refund NOW.   Wait for the update.

[mgosswein2]

rationally that does not make sense. The "online version"and the desktop version should be one and the same - they both rely in updates from the internet. Are you 100% certain on that? 

[macuser_22]

---

@mgosswein2 wrote:

rationally that does not make sense. The "online version"and the desktop version should be one and the same - they both rely in updates from the internet. Are you 100% certain on that? 

---

Not the same at all.  Online is simply a code change in TurboTax's OWN web server that they can done anytime.

Desktop updates must  be complied and packaged for 4 different Windows versions and 4 different Mac versions.   The Mac update is about a 220MB file that can take an hour to download on a slow internet connection (that many still have have to pay by the MB) and 1/2 hour or more to install.     Too many updates is very time consuming and inconvenient for many desktop users.

[dore7tvet]

Does anyone have the specific date/time when the Desktop Version updates will be made available?

[mgosswein2]

looks like there is an update today as it queued up on my laptop version - we shall see if it includes the patch for tax free unemployment