Congress removed the federal taxability of unemployment benefits up to $10,200 for individuals and $20,400 for married couples filing jointly. This past week, the IRS finally confirmed how it would handle refunds for people who had already filed their 2020 tax returns. ADFor those taxpayers who already have filed and paid taxes on the full amount of their unemployment benefits, the IRS said it will determine the correct taxable amount. If you’re doing your own taxes, you can find an updated worksheet about the unemployment income exclusion at irs.gov/form1040. In a typical tax year, you wouldn’t be able to count unemployment benefits toward qualifying for the EITC.

Source: Washington Post April 02, 2021 09:56 UTC