TurboTax update to 2021 American Rescue Plan

[cmBarron]

Yeah, I did the manual adjustment of my unemployment, too, and, like you, the tax owed was different by a whole decimal place.

[mh8279]

That is great news!  Wonder why I didn't receive that email since I signed up for the notification.  Oh well, thanks for posting!  Could I ask if you would post if the software is updated just in case I don't get an eamil.  Thanks again.

[mh8279]

@dollheaddemon

Thanks for posting the email you received.  I wonder why I didn't receive one since I have signed up for the update.  Oh well, thanks again and if you could post that it was updated, I would greatly appreciate it.

[samden13]

How did you make the adjustment? I'm trying to file online with TT and can't seem to make any adjustments to my 1099-G for the tax credit. This will change our tax situation greatly.  Thank you to anyone with any input. 

[ReneeM7122]

The IRS strongly urges taxpayers not to file amended returns related to the new legislative provisions or take other unnecessary steps at this time. The IRS will provide taxpayers with additional guidance on those provisions that could affect their 2020 tax return, including the retroactive provision that makes the first $10,200 of 2020 unemployment benefits nontaxable.

For those who haven't filed yet, the IRS will provide a worksheet for paper filers and work with software industry to update current tax software so that taxpayers can determine how to report their unemployment income on their 2020 tax return.

TurboTax is developing the software required to process all of the new conditions.

How do I get the new unemployment benefits if I’ve already filed my taxes?

Here is a TurboTax article about the American Rescue Plan.

@samden13

[dh2004]

We did this edit and sent it our sons claim to the irs.  It does seem to fit the requirements: I went to line 22 of other taxable income worksheet type in UCE use the minus sign not parenthesis -10,200 and it will show in red. I takes it to the schedule 1 and the 1040

[DGtax]

I would have thought last night's update would have included the most recent unemployment exemption but those changes aren't flowing through to my forms.  I manually input the exemption on Schedule 1 as per the IRS instructions as well but am willing to wait a few more days if the next updates will include the exemption.  Has anyone had luck with the exemption flowing through without manually entering it?

[samden13]

I'm using the online version and I'm not familiar with how to enter it manually on Schedule 1. I really just want to file my taxes. 

[must]

I just went into my taxes 3/19 after receiving the same email from turbo tax, and no update for the unemployment benefit has been applied.

[vlincoln]

It seem strange, . .   I used to really believe in TurboTax. . . 

I have friends that use Taxslayerpro and they have already implemented the America Rescue Plan changes - -  completely. . .  SAD. . .   

[lafleurplumeria]

I was informed a week ago that TT will have completed their update of the recently-enacted American Rescue Plan by Friday (today 3/19/21), and, at that time, I can go ahead and complete filing my taxes.  Am I now to understand that  because I have not received an email from TT, confirming their update of the recently-enacted American Rescue Plan, I should not proceed with filing my taxes?  If so, please let me know at your earliest convenience.  I want to put this behind me ASP.

Thank you,

Steve Ababan 

[hosituandung]

A  married couple has a combined AGI >150K, but one spouse has an income <100K including his unemployment payments.

In past years, they filed tax returns using Married-Filing Jointly status. This year they plan to choose MFS status, and remove $10,200 from the unemployment income in the unemployed spouse’s return, but are not sure about whether the IRS will object.

What does the TT community think? Your feedback will be appreciated.

FYI: Section 9042 of the American Rescue Plan – 2021 (Suspension of tax on portion of unemployment compensation) only mentions about the 150K threadhold as AGI of the taxpayer, and not the combined AGI of married couples.

SEC. 9042: “(c) Special Rule For 2020.—

“(1) IN GENERAL.—In the case of any taxable year beginning in 2020, if the adjusted gross income of the taxpayer for such taxable year is less than $150,000, the gross income of such taxpayer shall not include so much of the unemployment compensation received by such taxpayer (or, in the case of a joint return, received by each spouse) as does not exceed $10,200.

[Self Preparer]

The American Rescue plans includes a provision for receiving too much tax credits towards Health Coverage on the Affordable Care Act regardless of income. With the the tax deadline fast approaching, when will TurboTax have this information uploaded? TurboTax should be offering direction to their customers so that they can file an extension if needed. 

[craveking]

The 10,200 exclusion has been implemented but the Premium Tax Credit provision has not. I received a message telling me I'm good to go on the Fed but not the State because the PTC changes have not been implemented. The problem with this very bad advice is the PTC affects your Federal return and could seriously impact your tax due or refund. 

[JamesG1]

@craveking

The IRS addresses the Premium Tax Credit in this IRS FAQ :

Check Back for Updates to this Page

We’re reviewing the tax provisions of the American Rescue Plan Act of 2021, signed into law on March 11, 2021. Taxpayers who filed a 2020 tax return and reported an excess advance premium tax credit repayment on Line 29 of Form 8962, Premium Tax Credit, should not file an amended tax return only to get a refund of this amount. The IRS will provide more details soon. For the latest updates, check IRS.gov/coronavirus.

[Edited 03/23/2021 7:16 AM PST]