Federal Tax Refund Delayed

[marcuscato]

Hello,

I filed early April 2021 using Turbo Tax. I am still waiting on my tax return. My best guess for reason for delay:

I had unemployment benefits for about 4 months in 2020 which I reported in the filing. Looks like the tax rules changed around the unemployment benefits - perhaps that is the source of delay? I am unclear if I qualify for the tax break on the benefits though given my income was high from the remaining ~8 months that I was employed. What are my options here? I have tried calling IRS a handful of times, but I get disconnected saying that they have high volume.

Thanks in advance!

[VolvoGirl]

You mean April 2021?  That was after the unemployment exemption was updated.  Check your return, 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.

Then for the refund. The IRS is taking longer.  Millions are still waiting.  You are not alone.

[marcuscato]

Hi @VolvoGirl thanks for the answer. Yes April 2021 (I edited the original post just no as well). I looked in my return just now. Schedule 1 Line 7 does have the unemployment benefits received. However, Schedule 1 Line 8 is empty. Does this mean I did not qualify for the exemption?

[Critter-3]

Save a PDF of the return WITH the worksheets to see the unemployment calculation for line 8 ... if there is no amount on that line then you probably did not qualify for it.  

[marcuscato]

How do I download the return WITH worksheets? I just clicked the large button at the very top of my dashboard and it downloaded a PDF, but it does not show any worksheet. I do see the Schedule 1 line 8 empty though.

[VolvoGirl]

Did you efile or print and mail your return?  Did you use the Online version or the Desktop program?  It may not have been updated for the unemployment exclusion yet.  Or your income is too high to qualify.

Here's an alternate way to print by opening the filed return back up to print at the Print Center, where you can also get the worksheets.

Log in and at the Tax Home or in the section Your Tax Returns & Documents for 2020, look for a link Add a State.  Click on Add a State.  (you don't really add one.  That's just to open your return back up.)

After the return is open, click in the left menu column on TAX TOOLS, then PRINT CENTER.

Then choose Print, save, view this year's return.

The next screen should offer some options:  Just my tax returns or include government worksheets (optional), or include government and TurboTax worksheets (optional.)

[marcuscato]

@VolvoGirl and @Critter-3

Sorry, I forgot to mention earlier: I e-filed using Turbo Tax online, with direct deposit to my bank. I think I used the Deluxe version.  

[VolvoGirl]

I see you said your income was high.  How high?  Has to be under $150,000.

[marcuscato]

@VolvoGirl I tried the steps you mention, but when I click on "Print, save, view this year's return" instead of giving me options to print it goes into asking me details about my State's ID etc. - looks like it is trying to force me into the flow of adding a state

[marcuscato]

Hi @VolvoGirl it was higher than $150K. Do I not qualify then? Sorry for the naive question. I tried to look up documentation for unemployment benefits exemption that is official (from IRS), that mentions a limit, but unable to find it

[marcuscato]

Never mind I found it! https://www.irs.gov/forms-pubs/new-exclusion-of-up-to-10200-of-unemployment-compensation 

You are right - I did not qualify given my income for rest of year was more than 150K

[marcuscato]

@VolvoGirl do we know the cause of the delay. If my case is simple - given there is not even an exemption for unemployment benefits and rest is just regular W2 and other forms from stock/mutual fund investments, for example 1099-DIV/INT etc (no family, no kids, no real-estate etc), then why would my return be delayed but someone who filed later than me got their refunds sooner? All my friends in the same state with same jobs and profile got their refund sooner. My federal refund is a low number too. So I am wondering how they pick and choose which one to delay? As far as I know there is no mistake in the return - I reported every form I had correctly in Turbo Tax. I did move out of New York city around Sept 2020, and didn't have to pay NYC city taxes for ~3 months, but that should affect only NY state tax return, whose refund I already got. So I am wondering what is causing simple tax returns from getting delayed?

[VolvoGirl]

No, the IRS is just taking longer this year.  Millions are still waiting.  You are not alone.  I would also check the Recovery rebate credit on line 30.  Anything there?  That has been a problem if you tried to claim the wrong amount.  That's the most common reason this year.  People are filing with the wrong amount on line 30 because they didn't enter the right Stimulus payments they already got for the first 2 rounds.

[marcuscato]

@VolvoGirl the recovery rebate credit on line 30 is empty. In year 2020, when the federal refund for tax year 2019 was credited to my bank, along with the federal return I got a $170 separate deposit (same day, same instant) on April 27th. I did not know what the $170 was given the bank transaction only mentioned IRS federal. I did not receive any letters from IRS explaining the extra amount. In TurboTax, this year, when I was filing taxes for 2020, I was asked if I got a "stimulus check" last year and I replied no, given I wasn't ever informed what the $170 was. Given I had a high income in 2019, I should not have qualified for stimulus anyway. Few weeks ago, I downloaded an "Account Transcript" for year 2020 and it says the $170 was a "Tax Relief Credit". Is that a stimulus payment? In any case, given I am not claiming a stimulus through the Recovery Rebate Credit on line 30, I should be OK? Or is the $170 causing an issue - how would I know what the payment was for a covid related stimulus? 

[VolvoGirl]

Good.  Don't worry about the 170.  That probably was for the first Stimulus payment.  Don't remember what they call the deposit.  You probably got a phase out amount based on 2019 or 2018.  

Generally, if you have adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns and surviving spouses, you will receive the full amount of the recovery rebate.  For filers with income above those amounts, the payment amount is reduced by $5 for every $100 over the limit.  So, your credit may be a weird amount.