With the latest batch of payments, the IRS has now issued more than 8.7 million unemployment compensation refunds totaling over 10 billion. Now the agency has begun reviewing the tax returns of those who claimed unemployment benefits according to their timeline. The latest update on IRS unemployment refund checks. The tax agency for its part had already processed and sent refunds to 42-plus million filers. When President Biden signed the American Rescue Plan into law over 66 million taxpayers had already sent their tax return to the IRS. The spouse that got $5,000 in compensation gets the whole amount waived, but the second spouse only gets $10,200 of the $20,000. The total amount is $25,000 but the couple would not be entitled to the full $20,400 waiver but only $15,200. The IRS gives the example of one spouse having received $5,000 of benefits and the other getting $20,000. Although the couple could receive up to $20,400 if both collected jobless aid in 2020, only half that amount could be applied to each. Turbo Tax is not allowing for the 10,200 deduction which should be deducted on Schedule Y, Line 9. The American Rescue Plan waived federal tax on up to $10,200 of unemployment compensation per person, that rule also applies for married couples filing jointly. The unemployment compensation is for only one person who received 23,481. This is due to the complexity of calculating refunds for a married couple based on the tax break. Will a fourth stimulus check be approved in May?.How your tax bill could change under Biden’s tax plans.IRS confirms payments for child tax credit are slated to begin this July.This means married couples who filed jointly will have to wait longer to get their refund if they have one coming to them than most who filed an individual tax return. The agency said it would start with individual tax returns first, followed by those with a filing status of married filing jointly and more complicated returns. In an announcement the IRS informed that the agency would handle the automatic adjustments in two stages with refunds expected to begin in May. vx5Cj2e8vR- IRSnews The IRS will process tax returns in two phases #IRS will take steps to automatically refund money this spring and summer. The American Rescue Plan allows taxpayers who earned less than $150,000 in modified adjusted gross income to exclude $10,200 of unemployment compensation in 2020 from taxes.
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