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The Coronavirus Unemployment Benefits Tax Relief Act would waive federal income taxes on the first $10,200 of unemployment benefits received in 2020. The tax relief would extend to both workers who received benefits through federal unemployment programs like Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC) as well as those who received traditional benefits through their state unemployment insurance fund.
The Coronavirus Unemployment Benefits Tax Relief Act would waive federal income taxes on the first $10,200 of unemployment benefits received in 2020. The tax relief would extend to both workers who received benefits through federal unemployment programs like Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC) as well as those who received traditional benefits through their state unemployment insurance fund.
Would have to see the final signed version of the bill.
I understand it will benefit me but this tax break on the first 10,200 of UI is absolute BS ... they want to pass this because so many people didnt have taxes withheld and now face a tax burden??!? my lord....
Tend to agree with you, but keep in mind thanks to their messed up and antiquated DOL computer systems, many states simply didn't offer option for withholding of federal taxes on the "extra" UI bennies.
Some states (if option was chosen) took taxes out of both regular UI along with everything else that came out of CARES Act. Others only takes from straight UI but not any of that extra $600 or $300 per week.
Since you had no small number of people collecting far more money on UI than they earned from normal employment, yes there is going to be a shock on tax day.
If every state had their ducks in a row and allowed UI claimants to withhold federal taxes on all benefits, then yes would say this latest "gimmie" is not necessary. But this is how US rolls now; it's all part of "I get a check, you get a check, and *you* get a check..."
I would imagine that if this goes through with the forgiveness of 10.2K in UI that some kind of paper work would have to be sent to us citizens. I have looked at the 1040 and really cannot find a line where you can claim this 10.2K. If anyone can find it help me out.
I would imagine nearly a quarter of all people who file have done so already. Unless some kind of credit can be applied to 2022 returns this is shaping up to be an administrative nightmare for the IRS.
People were urged to file early to get the stimulus check.
It will indeed be an admin nightmare for IRS. I am looking at a blank 1040-X (amended return, which I assume everyone who already filed will need to file), and there is a line for "taxable income", of which I am guessing we just deduct $ 10.2K from what we had previously.
One change I am aware of is that amendments can be E-filed now. In the past, they could only be done via paper amendment (even if the original return was E-filed).
Horror show. I know that for people that did not get the first stimulus check there was an option to get a credit on this year's return. Hopefully they clarify this and send guidance to the community of tax preparers. Just deducting 10.2K on an electronically filed amended return on the taxable income line just doesn't sound like a good idea and might raise some red flags with the IRS. Guess we'll see. This does seem to penalize those who worked and must report all of their income.
I had 10% witheld every week from my ui payment(my choice) and yet haven't filled out the tax return.
Any ideia on how to proceed in this case,since the senate approved a tax waiver for the first 10200 earned in ui
I had 10% witheld every week from my ui payment(my choice) and yet haven't filled out the tax return.
Any ideia on how to proceed in this case,since the senate approved a tax waiver for the first 10200 earned in ui
Once it's signed into law there will be instructions on how to proceed, probably a new form to get your refund
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