topic The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon in Retirement tax questions

The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

hk2528 — Sat, 06 Mar 2021 18:01:13 GMT

of course it will still need house approval, but it looks like it will pass. I question is that will Turbotax update the software soon. thanks

Re: The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

DoninGA — Sat, 06 Mar 2021 18:03:39 GMT

TurboTax nor any other tax preparation software company can do anything until the IRS has written the rules and regulations after passage of legislation which changes the tax code.

Re: The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

xmasbaby0 — Sat, 06 Mar 2021 18:04:56 GMT

It is not a newly passed law. It is a topic of discussion/debate in the Senate as a part of the 3rd stimulus bill they are working on. When and if the 3rd stimulus bill actually passed and is signed into law, there will be guidelines for the IRS and for tax software to use.

Re: The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

Commodore_Guff — Sat, 06 Mar 2021 18:47:56 GMT

The bill passed the senate so it will signed into law

Re: The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

macuser_22 — Sat, 06 Mar 2021 18:58:13 GMT

@Commodore_Guff wrote:

The bill passed the senate so it will signed into law

No - it goes back to the house.

If signed into law then the IRS must write the regulations and new tax forms before any tax software company can incorporate those new forms that do not exist yet.

The IRS typically takes 2-4 months to issue new regulations and forms.

There is no guarantee that it will be retroactive to 2020.

Re: The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

fanfare — Sat, 06 Mar 2021 19:36:58 GMT

No way any of the new law will be retroactive.

you will get a tax break on your 2021 tax return if you get UI compensation in 2021.

The progressives could still derail the whole thing and cause a "start over".

Re: The newly added tax exemption for the first $10,200 of unemployment benefits would be applicable for the 2020 tax year,will this newly passed law add to the update soon

Mark166 — Wed, 10 Mar 2021 20:23:51 GMT

The $10,200 unemployment exemption is retroactive, and only applies to the 2020 tax year. It does not apply to 2021.