TurboTax update to 2021 American Rescue Plan

[willhamm]

fyi, to level set expectations - the tax bill will not be going down by $10,200. Your son's income will be reduced by 10,200, so the tax reduction will roughly be $10,200 x marginal tax rate (e.g., 15%). So the tax benefit on someone with a 15% tax rate will be $1530 if they received at least $10,200 in Unemployment benefits. Hope this helps. 

[RIMom1]

Turbo Tax won't allow anything to be entered on Schedule 1, Line 8, as far as I can see. How did you do it?

[gloriah5200]

If you’ve already filed your 2020 return, hang tight. The IRS will provide guidance on how you can claim these additional benefits soon.

[DianeW777]

The instructions provided by IRS and included above are for paper returns. 

With this new law, if your household income is less than $150,000, the first $10,200 of unemployment will be tax-free, but any amount you receive above that will be taxed. We must wait on the IRS for the way they want this to be handled.  Please continue to use the links below to know the most up to date information. If you already filed your tax return do NOT amend at this time per IRS. 

• How do I claim the new unemployment benefits in TurboTax?
• How do I get the new unemployment benefits if I already filed?
• American Rescue Plan: What Does it Mean for You and a Third Stimulus Check
• IRS Statement-American Rescue Plan Act of 2021

[Wally1600]

I believe according to other posts, you can only do this if you have the CD/Download version which is what I have purchased. I would like to file electronically and will if Turbo Tax updates their software prior to April 15th. 

[DawnC]

Both the Online and Desktop versions are being updated to reflect these changes.  No date has been determined as to when this will be completed.   You can sign up to receive notifications using the links below.   You will be able to e-file.  @Wally1600

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

How do I claim the new unemployment benefits in TurboTax (have not yet filed your 2020 return)?

[genez220]

"It can take weeks to several months or more for the changes to be made to tax software."

So with the understanding that updating TurboTax software will be a lengthy process and with the tax filing deadline quickly approaching (in about 30 days), is the recommendation, then, for everyone to file for an extension?

[gloriah5200]

If you haven’t filed your 2020 taxes yet and would like to receive progress status updates on the unemployment adjustment, please sign up here. 

IRS is very busy and they have to give the software companies guidance on how to make changes in their software and when it is available, and hopefully how to make it e-fileable since IRS is still processing 2019 paper returns filed last year.

We recommend waiting for IRS guidance on this before filing.

[ciaoskip]

All the descriptors say if your AGI is less than $150,000 the $10,200 tax free exclusion can be applied but its not clear when filing jointly married. For this specific determination,  is the $150,000 threshold our combined AGI or each  individual AGI if filing jointly married?

[ErnieS0]

$150,000 is the total joint income on a married filing joint income tax return.

The IRS says:

Generally, if you are a U.S. citizen or U.S. resident alien, you are eligible for the full amount of the third Economic Impact Payment if you (and your spouse if filing a joint return) are not a dependent of another taxpayer and have a valid Social Security number (see exception when married filing jointly) and your adjusted gross income (AGI) on their tax return does not exceed:

• $150,000 if married and filing a joint return or if filing as a qualifying widow or widower
• $112,500 if filing as head of household or
• $75,000 for eligible individuals using any other filing statuses, such as single filers and married people filing separate returns.

Payments will be phased out – or reduced -- above those AGI amounts. This means taxpayers will not receive a third payment if their AGI exceeds:

• $160,000 if married and filing a joint return or if filing as a qualifying widow or widower
• $120,000 if filing as head of household or
• $80,000 for eligible individuals using other filing statuses, such as single filers and married people filing separate returns.

For example, a single person with no dependents and an AGI of $77,500 will normally get a $700 payment (half the full amount). A married couple with two dependents and an AGI of $155,000 will generally get a payment of $2,800 (again, half the full amount). Filers with incomes of at least $80,000 (single and married filing separately), $120,000 (head of household) and $160,000 (married filing joint and surviving spouse) will get no payment based on the law.

Related Resource:

• Who is eligible for the third Economic Impact Payment and what incomes qualify?

[whatabigbaby]

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

[mh8279]

This is great if you use the paper forms but what about turbo tax?  Has the online been updated or still waiting?

[DoninGA]

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@mh8279 wrote:

This is great if you use the paper forms but what about turbo tax?  Has the online been updated or still waiting?

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See this TurboTax support FAQ for information for the unemployment compensation exclusion - https://ttlc.intuit.com/community/tax-topics/help/how-do-i-claim-the-new-unemployment-benefits-in-tu...

Also see this IRS statement - https://www.irs.gov/newsroom/irs-statement-american-rescue-plan-act-of-2021

[ReneeM7122]

Here is a comprehensive list of federal and state forms availability across TurboTax products.

Federal Individual Forms Availability (intuit.com)

State https://care-cdn.prodsupportsite.a.intuit.com/forms-availability/turbotax_states_online_individual.h...

State forms availability table for TurboTax individual (personal) tax products

Select your situation to locate your 2020 form.

• TurboTax Online/Mobile (web, iOS or Android)
• TurboTax CD/Download for Windows
• TurboTax CD/Download for Mac

Keep in mind:

• When you locate your form or schedule, there will be dates for both Print and (depending on the state and the form) E-file availability. If the E-file form is listed as unsupported, the form must be printed and you'll need to mail your return.
• Forms and schedules missing from the table aren't supported in TurboTax.

Related Information:

• IRS forms availability table for TurboTax individual (personal) tax products
• State forms availability table for TurboTax Business
• Which IRS forms are not included in TurboTax?
• Are there any personal (individual) tax situations or calculations that TurboTax doesn't handle?

@DoninGA

[JTom]

The filing deadline for tax returns has been extended from April 15 to July 15, 2020. The IRS urges taxpayers who are owed a refund to file as quickly as possible.