Unemployment tax exemption update

[Goonie84]

I received an email saying the TurboTax software would update today to be able to claim the unemployment deduction credit from the new relief bill. However, when I signed in to review, nothing was updated. Any status on this?

[macuser_22]

"Today" has a long time to go - until midnight.

[devdude1962a]

Its now 3/24 I have received no update to the software.  I guess its time to talk to someone live to find out what the deal is.

[macuser_22]

The normal scheduled desktop update day is Thursday after noon pacific time - that is 3/25.  The last update was Thursday 3/18 but that was to late to include this change since it takes a week to recompile and test  8 difference Windows and Mac versions.

[leslienagy]

Hello,

I had taxes taken out of my unemployment automatically.  I have not filed my taxes yet through Turbo Tax, and there appears no way to claim or record it.  How do I get the taxes paid back for exempt first $10,200 of unemployment?  Will they update the software automatically and how will I know they have done this?

[macuser_22]

Federal tax withheld should be in box 4 on the 1099-G and that will go on the 1040 form line 25b to be applied against your total tax or add to your refund.

[leslienagy]

Thank you for responding.  So, when I entered the amount from box 4 the Federal Tax Due box at the top of the screne did not change and reflect the amount I should be getting back.  Are we still just waiting for the software to be put in place and then it will show the refund?  Turbotax does not have a line 25b like there would be if I were filing with pencil and paper.

[macuser_22]

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@leslienagy wrote:

Thank you for responding.  So, when I entered the amount from box 4 the Federal Tax Due box at the top of the screne did not change and reflect the amount I should be getting back.  Are we still just waiting for the software to be put in place and then it will show the refund?  Turbotax does not have a line 25b like there would be if I were filing with pencil and paper.

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If course is does.  Line 25b is on the 1040 form that is your tax return.

If you are using the desktop version then switch to the forms mode and view the 1040 form.

If using online then see this link:

https://ttlc.intuit.com/community/accessing/help/how-do-i-preview-my-turbotax-online-return-before-f...

[leslienagy]

Hi again,

Thank you for the follow up and instructions.  I was able to generate that paperwork.  So, I had taxes taken out of my unemployment already.  Will I be getting back the taxes from the first $10,200 from the government and if so, how will that happen.?  Are we still waiting for turbotax to update the software to handle this automatically?  Previously someone wrote that it would be updated today, but it does not appear to reflect the new rules as of yet . . .

[devdude1962a]

The update did in fact go through and there was a change to my tax.  I am however preparing another return for a friend.  He had 3,754 in Unemployment and his wife had 34,000.  Turbo tax is allowing 10,200 to come off the total Unemployment compensation number.  I would think 10,200 would come off the 37K and the 3,754 would be wiped out.  What could the issue be that is disallowing the 2nd 10,200? 

[macuser_22]

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@devdude1962a wrote:

The update did in fact go through and there was a change to my tax.  I am however preparing another return for a friend.  He had 3,754 in Unemployment and his wife had 34,000.  Turbo tax is allowing 10,200 to come off the total Unemployment compensation number.  I would think 10,200 would come off the 37K and the 3,754 would be wiped out.  What could the issue be that is disallowing the 2nd 10,200? 

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Sounds like both 1099-G's were entered for the same spouse.   

[leslienagy]

Hello,

Just to let you know that my taxes were finally updated to reflect the unemployment adjustment.  Thank you for your support over the past few days with this!

[leslienagy]

Hello,

Any idea if Massachusetts State Taxes for unemployment will be adjusted as well or is it just Federal?

[JohnW152]

According to the Massachusetts Department of Revenue's Tax Filing Season Frequently Asked Questions page, they'll most likely adjust your tax return, and no amended return will be needed:

Do not file an amended 2020 return before you hear from us. DOR will send a communication to all taxpayers who previously filed a 2020 income tax return reporting unemployment income and will adjust tax returns automatically for most taxpayers who meet the criteria for the unemployment deduction.

[leslienagy]

Thank you for the response.  I have not filed my return yet.  Will  turbotax be implementing the software for the state as it did for the federal ?