How To Enter 2020 Unemployment Compensation Exclusion On Schedule 1, Line 8?

[ryoung808]

According To The IRS, We Need To Enter On Line 8 Of 2020 1040 Schedule 1: "UCE"   "($10,200)

I Am Not Able To Do A Over-Ride On Line 8

Please Advise.

Thank You.

[KathrynG3]

The value on Line 8 cannot be entered as an override. For now, wait for this update to be evidenced by watching the Refund Tracker to increase for the amount of unemployment income up to $10,200 that was currently taxed.

The IRS intends to work with tax software companies to add an additional worksheet. However, these are not yet implemented. They will be incorporated as soon as possible.

See: IRS Statement - American Rescue Plan Act of 2021

New Exclusion of up to $10,200 of Unemployment Compensation

[DaRose46]

This answer is 5 days old.  My software is up to date as of 3/18 but no change.  When will the exclusion show up?

[DawnC]

The updates have not been completed yet.  You can sign up here to receive an email notification when the changes have been fully implemented into TurboTax.  We are ensuring that the $10,200 of unemployment income gets excluded from taxable income using the IRS's accepted method.   Although you can go in and manually exclude the income without waiting for the update, we recommend waiting for the update to prevent long delays in processing and possibly having to file an amended return later.   

For state returns and unemployment income, please see How is my state taxing unemployment income?       @DaRose46

[Special Ed]

Dawn and other Employee Tax Experts, you can see that customers are getting upset at non-answers.  Please test this process and then broadcast it instead:

Got to IRS.gov and search for ‘unemployment worksheet.’  You’ll find a page titled, “New Exclusion of up to $10,200 of Unemployment Compensation."  I’d put the link here but this forum deletes all links.  Print that worksheet, fill it out, and save it with your records.

When you have the result, follow the worksheet directions and open your Form 1040, Schedule 1 in your tax return.  You’ll see that the Line 8 entry is ‘calculated,’ so you can’t change it.  Double click on that number field, which will open a worksheet with the same Line 8.  It’s calculated again, so double click on that number field again.  That takes you to a Schedule 1, Line 8 worksheet in the TT program.  Scroll to the bottom, Line 22, Other Taxable Income.  Enter your exclusion as a negative, like ‘-10,200.’  Type “UCE” on that line to explain the entry.  Hit Return to finish your entry.

Go back to your Form 1040 and you should now see the correct unemployment total in Line 8.