COVID relief bill includes a provision (Sec 9662) that eliminates repayment of 2020 subsidy if subsidy exceeds the allowed credit. Will TT change to account for this?

[tsgunter81]

For example, if subsidy of $1,000 per month was applied to ACA premiums, but 2020 income exceeded amount eligible for such subsidy, $12,000 tax would normally be due. Sec 9662 of COVID relief bill eliminates reconciliation of the subsidy and credit, meaning $0 tax would be due for tax year 2020 only.

[SamS1]

We don't have specific information or procedures for the American Rescue Plan.  The Senate passed the American Rescue Plan on March 6.  This will include a third stimulus package.  TurboTax will follow these developments and wait for guidance from the Treasury Department and IRS.
 
You can find the most up to date information from the IRS here, and updates from TurboTax here as they develop.

[Anonymous]

If and when the bill becomes law (which seems increasingly likely), then, of course, it will.  However, this will be several weeks to many months away.   Before anything can happen there are a number of things that must happen.  

1. Obviously, the bill must be signed into law. 
2. The IRS must create policies and procedures and create new forms or modify existing forms. 
3. The IRS must reprogram its own computers for these new and existing forms. 
4. Software companies, such as the makers of TurboTax can't even begin to really program until the IRS has set the rules and created the forms.  They also have to wait for the instructions on how their systems must "talk" to the IRS systems.  
5. The software companies must program the new forms into their software.
6. The software companies must get approval from the IRS for their electronic form versions.
7. The software companies must release the updates, train employees on updates, and get customers through the process of applying them to software that is not online.
8. The software companies must tweak the software when it doesn't run perfectly on the first try (as it rarely does).

While all of this is taking place, IRS employees who should be processing 2019 and 2020 returns still yet to be processed to give millions of Americans billions in refunds will be directed to these tasks causing them to wait for more money than they will get through these changes.  But, I digress...

[tsgunter81]

Since the act was signed into law, TurboTax has incorporated some of the changes, but this change doesn't seem to have been addressed.  My taxes still show the subsidy repayment due. With the filing deadline approaching, what should I do?  Thanks.

[DoninGA]

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@tsgunter81 wrote:

Since the act was signed into law, TurboTax has incorporated some of the changes, but this change doesn't seem to have been addressed.  My taxes still show the subsidy repayment due. With the filing deadline approaching, what should I do?  Thanks.

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Are you referring to the Premium Tax Credit section when you have an excess advance premium tax credit to be repaid?

If so, that provision of the code has not been incorporated into the TurboTax software yet.

You have until May 17, 2021 to file the 2020 tax return.

[pifis]

TT states that it has already updated the federal forms for the new tax relief.  However, my taxes still show that I'm due to payback all of my 2020 subsidy.  (I live in Florida and have to state taxes.)  Have the federal forms been updated to address Sec 9662 regarding the payback of excess subsidy?