☰
✕
Sign In

Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
Level 1
posted May 12, 2021 7:09:58 AM

TurboTax 2020 deducting Federal 10,200 Unemployment compensation deduction then adding back in for NY state

Hello.  I hope everyone is safe and healthy.

I've noticed that in 2020 TurboTax on the New York State tax return, the 10,200 Unemployment compensation deduction is subtracted from income on IT-201 line 16, but added back in in the recomputed federal adjusted gross income line 19a after the line 19a smart worksheet.

 

Why?

0 2 676
2 Replies
Expert Alumni
May 12, 2021 7:31:05 AM

Unemployment is reported as a subtraction on the New York resident return (IT-201) because it is also subtracted on the federal return. The subtraction is necessary to match federal adjusted gross income (AGI), which is the starting point on the NY income tax calculation.

 

It’s then added back because NY does not allow for the $10,200 unemployment exemption.

 

Level 15
May 12, 2021 7:31:18 AM

New York is still taxing all of your unemployment.   Some states adopted the federal change of waiving tax on the first $10,200 of unemployment---but New York is not one of those states.  In NY--it is all taxable by the state.