Covid Relief Bill Unemployment Tax Changes - Already Filed

[DMH26]

This is the same information I received from my Congresswoman's office: the IRS will be taking care of the unemployment earnings tax exemption and making the adjustments to your tax filing. The tool for them to do this should be in place and tax refunds issued in May.

[mdcommuter]

It's great that TurboTax pushed an update to include the unemployment exemption amount, but I filed before the update and now my original Federal forms have updated to reflect the unemployment exemption even though that is NOT what I filed with the IRS in early March.  This update to my forms is impacting completion  of my state return (due May 17).  Is there a way to get the original federal tax file back into my Turbo Tax.

[LinaJ2020]

If you have filed, you do not need to amend unless you qualify for other credits or deductions due to a reduced AGI.  

 For details from the IRS, click here:  No amendment

Per IRS, "There is no need for taxpayers to file an amended return unless the calculations make the taxpayer newly eligible for additional federal credits and deductions not already included on the original tax return."

For your state, it depends on which state you are in.  Not every state conforms to the federal unemployment exclusion rules and guidelines.  Most of the federal and state sections in TurboTax program have been updated.  As the information under Federal section will be transferred to the State, please follow prompts in the program to amend your state return if needed.  To verify if you need to amend your state return, contact your state here:  Your state

@mdcommuter

[JulieO]

I understand that the IRS is stating this will happen automatically (but when?) this also effects your state return and they are requiring you to file an amendment.  So if the federal government is taking care of it automatically how are you supposed to file a state amendment as the federal has to be accepted before you can file an amendment with the state. 

[Critter-3]

They started processing those in   mid May but they expect it  will take most of  the summer to process the MILLIONS of returns that got dropped into a department that usually handles a few thousand returns per year. 

[XAM330]

mdcommuter

This is a bit late but here is something to try for years to come.

If you opened the file you sent and then saved the new updated file I do not believe you can go back. I can say this though as far as how I have handled my TT for years as a way to prevent this from happening. When doing your taxes there will always be updates and this year was a real doozy. Make a FOLDER for your taxes (I use 2020 SENT) and this will be the tax files that you send in and all files such as the .PDF of your forms. Anytime you would like to see if there might be an update that you think will change your status do this. Go to your (FOLDER SENT) and make a copy of the original file xxxxxxxx.tax and place it (paste) somewhere else (I create another FOLDER such as UPDATES 2020 for this) and rename it by adding the update and date (xxxxxxxxxxxUPDATE APRIL xx 2020.tax) and then double click on it or open TT and find that file on the list and open it. TT will update every time you open it and are connected to the Internet unless you tell it not to. Once the copied file is opened it will be updated automatically and you will see any changes and when you close it you can save it as is. DO NOT open the original xxxx.tax file again unless you are sure that you will REMEMBER to select NOT TO SAVE THE FILE WHEN YOU CLOSE IT. You should always save copies of the xxx.tax files and always save the .PDF of the file that you can print making sure to select to copy/print all forms and worksheets NOT just to send but ALL FORMS. Keep these on a USB or other drive as backups to the ones on your computer. If you make a copy after you input all tax data you should make a copy that you can use to do any changes to see how they affect your taxes before or after you send them in.

One other thing that you could do is if you have the disc for TT you could install on another comp and NOT let it update then input all your info and see how close it is. This will not have the $10,200.credit but may also not have other updates that you need for the time of your filing.

I had the same thing happen this year after sending taxes in and waited for the update to TT. After the update, I did as described above and now I know what I should get back. I just received my refund but it was only for the amount + interest and of the original return (my state does not tax unemployment so there was no change to state refund) so I am here looking to see if I can get a idea of when I may get the rest and the letter from the IRS. Well at least I don’t have to wait till August to get my refund like last year although it might take that long to get the $10,200.00 credit. Hope this helps.

[hokiegirl1]

I am one that filed my return very early and now because of the unemployment relief tax changes I am due an additional refund.   I filed in February and I DID NOT file an amended return.  It is now August and I still have not received my additional refund.  You can't call the IRS to get any answers, so does anyone really know when I should expect my additional refund?

[xmasbaby0]

@hokiegirl1 No--no one knows and no one can tell you.   You just have to wait.

 The IRS is recalculating refunds for people whose AGI is $150K or below and who filed before the tax law that changed the amount of unemployment that is taxable on a federal return became effective.   

The IRS began to send out the additional refund checks for tax withheld from unemployment in May.  The refunds are being sent out in batches—starting with the simplest returns first.   If you are eligible for the extra refund for federal tax that was withheld from your unemployment the IRS will be sending you an additional refund sometime during the next several months.  TurboTax cannot track or predict when it will be sent.  The IRS has not provided a way for you to track it, so all you can do is wait for the refund to arrive.

https://ttlc.intuit.com/community/tax-topics/help/how-do-i-get-the-new-unemployment-benefits-if-i-ve...

Please read this very recent news from the IRS:

https://www.irs.gov/newsroom/irs-to-recalculate-taxes-on-unemployment-benefits-refunds-to-start-in-m...

https://www.irs.gov/newsroom/irs-begins-correcting-tax-returns-for-unemployment-compensation-income-...

https://ttlc.intuit.com/community/tax-credits-and-deductions/help/am-i-eligible-for-a-new-credit-or-...

[Alberth2628]

I have already done my Taxes for year 2020 so do need for the unemployment tax 

[Alberth2628]

so I need to anything else 

[Alberth2628]

I have already done my Taxes for year of 2020

[VolvoGirl]

@Alberth2628   When did you file?  Did you file before the 10,200 unemployment exemption?  

If you filed early before the exclusion, the IRS will recalculate your return for the new 10,200 unemployment exemption for you. There is no need for taxpayers to file an amended return unless the calculations make the taxpayer newly eligible for additional federal credits and deductions not already included on the original tax return.

No way to track it.  Just keep waiting.  The IRS is sending them out in batches over the summer.

See IRS news July 13, 2021

https://www.irs.gov/newsroom/irs-readies-nearly-4-million-refunds-for-unemployment-compensation-over...

If you didn't file early........Your unemployment compensation will be on Schedule 1 line 7.  The exclusion will be on Schedule 1 Line 8 as a negative number. The result flows to Form 1040 Line 8.

[Sit and wait]

• I didn't c what. Ii picked in the pop up. Window it was fast

[xmasbaby0]

@Sit and wait  You have added to an old thread.  What pop-up window went too fast?   What are you trying to do?