Tax Year 2020: TurboTax Updates on Unemployment Tax Relief

[ToddL99]

TurboTax will update their programs for this change as quickly as possible (with all the other state changes), but isn't able to give an expected date for those updates.

Maryland just announced (today) that their tax forms have been updated to reflect this tax relief measure.

TurboTax had to wait for those forms to be released before making changes to our programs.

See MD Revised Individual Tax Forms Are Ready

[ebjlarsen]

Thank you @ToddL99 for the quick answer
I thought Maryland updated their forms 2 weeks ago, but evidently I was wrong

Much appreciated! 

[Buddog-1]

I had no issue with Maryland, but I do not use the online version.   You can also go to the Maryland Comptroller website and use their iFile software at no charge to file online.  

[kwalkup98]

West Virginia announced on Mar 18th that the deadline was extended to May 17th.  However, when I logged in today, it still says my WV return was due Apr 15th.  So that has not been updated.  Also, the governor signed the bill a few days ago saying that WV will follow federal guidelines and not tax on the $10,200 of unemployment income.  When can we expect to see these updates for WV?  

[neloyo]

It's now Friday 4/16. I still don't see any change to my TurboTax program pertaining to the new federal tax relief calculations on unemployment benefits. Has anyone at TT gotten an answer from the IRS as to when it will be rolled out?

[VolvoGirl]

Actually today is Tuesday 4/20.  Have you filed yet?  Turbo Tax has been updated for the unemployment exclusion for almost a month now.

For the Unemployment 10,200 exclusion......

You don't have to do anything special to get it.  It is automatic.  Just enter your 1099G.  If the exclusion doesn't show up you may need to update the Desktop program.  If updating doesn't help or you are using the Online version then delete the 1099G and re enter it.

If you have unemployment you can exclude up to 10,200 if your income is under $150,000.  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.

AFTER FILING

If you already filed and didn't get the 10,200 unemployment exclusion you do not need to amend.  The IRS will be adjusting it for you.  See,

https://www.irs.gov/newsroom/irs-to-recalculate-taxes-on-unemployment-benefits-refunds-to-start-in-m...

[Mjkess47]

TT has NOT corrected the unemployment covid exemption (credit) problem on the WV state return as of now, 8:30 PM, 4/20/2021.  I just checked my return details and TT is adding the unemployment as other income at the moment. I hope that they get it corrected. 

[JulieC14]

Yes, West Virginia's state returns are not updated yet for the unemployment changes.  TurboTax is working on getting each state's returns up to date as they each conform to the new federal American Rescue Plan. 
You can check the state status with this link:  How is my state taxing unemployment income?   Scroll down to West Virginia and click on the blue expand arrow to find the latest update.  

@mjkess47 

[spdev25]

You are correct.  Some of the states do not have an adjustment for the unemployment.  You should check that link and see if your state is giving an adjustment.  Some of the states are NOT.  You can still complete and e-file your FED return and wait on the state.  You can still get your FED return without sending in your state return.

I am in MI and there is no adjustment for the unemployment, but MI gives other deductions so it didn't matter with mine.

[hagerrann0822]

Has Turbo Tax updated their software to fix KY’s state return to add back 10,200?

I did file before this was adjusted.  Now, I will owe KY state taxes.  My fault for filing too early.  I don’t believe KY will fix each return, so I am assuming we need to amend before May 17 to avoid penalties.  

[misty_blue8203]

I went through all of the steps to file my taxes and when I got to the end, it said I owed 150 to the state of WV. I was on unemployment for a few months and after looking into it further, I saw that turbo tax had not updated its system yet for the exemption in WV. Last night, when I went back in to check it again, I suddenly was getting a refund for from the state. Does this mean the system had been updated and I can now file without having to worry about it. I had already given my routing number to have the 150 debited from my account when my state taxes were accepted (before I realized it was wrong). Will that still be taken out? Can anyone give me an update? Please? When I go to the link and check WV, it says the system has not yet been updated for Wv. This is why I’m so confused!

[DMarkM1]

@hagerrann0822 

TurboTax has updated to add the 10,200 back to KY taxable income. 

Just to clarify.  You filed your returns after the federal update that excluded the 10,200 but before KY decided to not conform? 

Or did you file before either changed?  If the latter, then your KY return would be correct, as at that time both FED and KY included unemployment benefits as taxable income and KY still does.  

Check your KY form 740 line 5 does that line from your Fed AGI include or not include 10,200 of unemployment?  If it includes all unemployment from your federal form then you are good to go.

However, if that line is10,200 short of total income, then you indeed will need to amend.

Sign in to your TurboTax account and select the "Add a state" option.  Continue your KY state interview and click through to the "Additions to Federal Income" page. There you should see a line with the addition of 10,200. Add a line "Unemployment Adjust" with a negative (-10,200) entry. This is to make your return match what was originally filed. 

Then continue through to the "Amend KY" page and select "Yes" to amend your KY return by removing that -10,200 entry and allowing the  10,200 addition to remain.    

[jstelter]

I still am not seeing updates to the (federal) Unemployment tax refund on the downloaded software - though I got he updates just this morning. Please advise as to how to locate/use it. 

[VolvoGirl]

@jstelter  Did you enter a 1099G for unemployment?  If updating doesn't help then delete the 1099G and re enter it.

Or do you have a high income?

If you have unemployment you can exclude up to 10,200 (per spouse) if your income is under $150,000.  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.

Are you on Windows?  Try doing a manual update 

https://ttlc.intuit.com/community/updating/help/manually-update-turbotax-for-windows-software-basic-...

[Happygirl1]

My online version still has not updated. Will there be an update for this? The only way I know I am due additional refund is when I click on prepare state.