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Amended Refund possible mess

About 45 days ago, I decided to amend my return after the unemployment change because I learned that I needed to do that if the unemployment change made me qualify for EIC, which it did. The IRS accepted this amendment. A few days later they gave me their recalculated refund - the refund they said they would do on their own. My question and possible problem is since the IRS already gave us the recalculated refund which didn’t account for EIC (which is why I amended) how much is my amended return going to screw up things and is there anything else I should do. Also I have yet to receive the amended refund (which they said has to come by check (is that true?) even though they have my direct deposit info) and the IRS’s “where’s my tax refund” portal says it doesn’t work with amended returns. 

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Employee Tax Expert

Amended Refund possible mess

Thank you for your question, and thank you for contacting TurboTax Live!


We see from your question - that about 45 days ago, you decided to amend your tax return after Congress passed the American Rescue Plan - which made the first $10,200 of  unemployment compensation as received in 2020.


You stated that the reason for your amended return - after the change to unemployment compensation - made me qualify for EIC, which did occur.  The IRS accepted this amendment.


A few days later the IRS gave me their re-calculated tax refund - the refund they said they would do on their own.


As to your question since the IRS already gave you - the re-calculated tax refund - and did not account for EIC (which is why you amended)  if there is anything else that you should do.   You also asked if and when you might receive the amended refund (which IRS told you would come by check, (even though the IRS  have your direct deposit information) and the IRS’s “Where’s My Tax Refund” portal does not work with amended returns. 

Here is the TurboTax Live! Resource that addresses your question:

When will I get my additional unemployment refund from the IRS?

According to the IRS, they will send payments in two phases:

  • Phase 1: The IRS will adjust returns for taxpayers eligible for up to $10,200 exclusion. Payments for phase 1 started the week of May 14.
  • Phase 2: The IRS will adjust returns for those married filing jointly taxpayers who are eligible for the up to $20,400 exclusion and others with more complex returns. 

The IRS issued millions of refunds the first week of June and plans to issue the next set of refunds sometime in mid-June. The IRS will continue to review returns and process corrections during the summer. The IRS is reviewing returns in order from the simplest returns and then to more complex returns.

Taxpayers will receive letters from the IRS generally within 30 days of the adjustment informing them of what kind of adjustment was made and the amount.

How will I receive my additional unemployment refund amount from the IRS? 

The IRS will issue refunds resulting from this unemployment income relief by direct deposit for taxpayers who provided bank account information on their 2020 tax return. 

If valid bank account information is not available, the refund will be mailed as a paper check to the address of record. The IRS will continue to send refunds until all identified tax returns have been reviewed and adjusted.

These refunds are subject to normal offset rules such as past-due federal tax, state income tax, state unemployment compensation debts, child support, spousal support or student loans. The IRS will send a separate notice to the taxpayer if the refund is offset to pay unpaid debts.

How do I know if I am now eligible for additional deductions and credits, and what do I do to get them?

It’s a bit tricky.

The IRS will adjust your return and the amounts for any deductions and credits you claimed on it. For example, say you claimed the Earned Income Tax Credit (EITC) on your return. And because the new unemployment exclusion changed your income level, you would now be eligible for an increase in EITC amount. The IRS would adjust your return for you and send you the additional refund amount with your additional unemployment benefits. You are all set.

The IRS is also making corrections to Earned Income Tax CreditPremium Tax Credit and the Recovery Rebate Credit since taxpayers may be eligible for these credits with the $10,200 income exclusion.

However, say you were not originally eligible for the EITC on your return, but now, because the exclusion changed your income, you are eligible for the EITC. You may need to amend your return to claim that new credit based on your tax situation:

  • The IRS can adjust tax returns for those who are single with no children and the exclusion makes them eligible for EITC.  
  • Taxpayers who have qualifying children and become eligible for any new benefits once the exclusion is calculated may have to file an amended tax return to claim new benefits.

If you chose not to amend your return, you’d only get the additional unemployment benefits automatically from the IRS and would miss out on additional money you’d be eligible for. 

The IRS can also adjust tax returns that already include EITC and qualifying children. If you filed with TurboTax, check your inbox. We sent you an email to help you understand how all this affects you and with instructions on what to do.

How do I know how much unemployment income I received?

When it’s time to file your taxes, you will receive Form 1099-G, which will show the amount of unemployment income you received. Form 1099-G will also show any federal taxes you had taken out of your unemployment pay. You are now entitled to exclude the first $10,200 of federal unemployment income from paying any taxes.

We sincerely hope and trust that this TurboTax Live! Resource is helpful, and please do not hesitate to contact us if you need further clarification!!!  Have a great day!

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