With the new unemployment exclusion recently issued my refund amount on my turbo tax return has increased. How do I take advantage of the increase? What do I do?

[coachfino]

I have already  submitted my 2020 return. How do I amend ?

[macuser_22]

The $10,200 unemployment retroactive to 2020 was signed into law.

If you already filed - do not amend. See this:
https://ttlc.intuit.com/community/tax-topics/help/how-do-i-get-the-new-unemployment-benefits-if-i-ve...

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

[coachfino]

Thank you for the quick reply. The confusion I am having is that even with the $10,200 exclusion my AGI is still just above the $150,000 threshold but Turbo Tax is still saying my refund has increase substantially. Not sure what is going on.  Any suggestions? Thanks

[macuser_22]

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@coachfino wrote:

Thank you for the quick reply. The confusion I am having is that even with the $10,200 exclusion my AGI is still just above the $150,000 threshold but Turbo Tax is still saying my refund has increase substantially. Not sure what is going on.  Any suggestions? Thanks

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Look at the 1040 form and schedules to see where it is coming from.

The unemployment exclusion would be on Schedule 1 line 8 with "UCE" if it was applied.

[JohnW152]

As macuser_22 notes, some Schedule 1 amounts need to be taken into account when computing your Modified AGI for unemployment exclusion purposes.

According to the Unemployment Compensation Exclusion Worksheet – Schedule 1, Line 8 on the IRS's New Exclusion of up to $10,200 of Unemployment Compensation page, the calculation for Line 8 of Schedule 1 is:

1. If you are filing Form 1040 or 1040-SR, enter the total of lines 1 through 7 of Form 1040 or 1040-SR. If you are filing Form 1040-NR, enter the total of lines 1a, 1b, and lines 2 through 7. 
2. Enter the amount from Schedule 1, lines 1 through 6. Don't include any amount of unemployment compensation from Schedule 1, line 7 on this line. 
3. Use the line 8 instructions to determine the amount to include on Schedule 1, line 8, and enter here. Do not reduce this amount by the amount of unemployment compensation you may be able to exclude. 
4. Add lines 1, 2, and 3. 
5. If you are filing Form 1040 or 1040-SR, enter the amount from line 10c. If you are filing Form 1040-NR, enter the amount from line 10d. 
6. Subtract line 5 from line 4. This is your modified adjusted gross income. 
7. Is the amount on line 6 $150,000 or more? 
   a. [ ] Yes. Stop You can't exclude any of your employment compensation
   b. [ ] No. Go to line 8 
8. Enter the amount of unemployment compensation paid to you in 2020. Don't enter more than $10,200. 
9. If married filing jointly, enter the amount of unemployment compensation paid to your spouse in 2020. Don't enter more than $10,200. If you are filing Form 1040-NR, enter -0- . 
10. Add lines 8 and 9 and enter the amount here. This is the amount of unemployment compensation excluded from your income. 
11. Subtract line 10 from line 3 and enter the amount on Schedule 1, line 8. If the result is less than zero, enter it in parentheses. On the dotted line next to Schedule 1, line 8, enter "UCE" and show the amount of unemployment compensation exclusion in parentheses on the dotted line. Complete the rest of Schedule 1 and Form 1040, 1040-SR, or 1040-NR.

[Edited 3/31/2021 | 10:08 am PST]

[coachfino]

Thank you for your helpful reply. Unfortunately my calculations are different than Turbo Tax’s. I still get my AGI as slightly over $150,000 and so does Turbo Tax but they are including the exclusion and giving me a bigger refund. Not sure what I am doing wrong. Will wait to hear from IRS.

[ThomasM125]

It would seem that the exclusion would not be allowed if your income is above $150,000. But like you say, the IRS will calculate any refund due you so there is nothing you need to do but wait and see.

[PayPerPeddler]

How much over $150K are you?