(Charlene Rhinehart, CPA)
Unemployment benefits caused a great deal of confusion this tax season. Fortunately, the unemployment tax nightmare that left many with reduced refunds or an unexpected tax bill is coming to an end.
The IRS announced that it will start issuing refunds in May to eligible taxpayers who paid more unemployment taxes than required for benefits received in 2020. But if you re still a bit muddled about how unemployment compensation affects your tax return, we ve put together the latest updates to ensure you re on the right track.
Image source: Getty Images.
Taxes on unemployment benefits
Unemployment benefits have been a hot topic this tax season. In 2020, millions of Americans suffered from job loss and were forced to apply for unemployment benefits to stay afloat during the pandemic. Unbeknownst to many, the additional income received from unemployment came with a cost.
IRS Will Soon Issue Refunds for Tax-Free Unemployment Benefits
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IRS Will Soon Issue Refunds for Tax-Free Unemployment Benefits
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Doktor ZoomMarch 05, 2021 04:59 PM
Jamie gave you this Sleepy Kitten The Senate s consideration of the $1.9 trillion COVID relief bill appears to have gone off the rails this afternoon, with Sen. Joe Manchin (D-West Virginia) apparently giving serious thought to a really bad Republican amendment on emergency unemployment that would almost certainly be unacceptable to most other Senate Democrats. Jesus Christ, Joe, we thought we already told you to just pass the goddamned thing. You never listen to us. Is it personal? As we noted earlier today, Senate Dems had already accepted one change from the House version of the stimulus bill. Instead of increasing the emergency supplemental unemployment insurance to $400 a week until the end of August, the compromise would keep the payments at $300 a week (on top of whatever state unemployment insurance benefits someone s getting), but keep the benefit running until the end of September.