If you received unemployment benefits in 2020 and already paid your taxes, the IRS could automatically refund your money. Thefrom March includes a , which means that unemployment checks sent during the do not count as earned income for the year — therefore you can’t be taxed on it. If, however, you paid taxes on the money before the unemployment tax break went into effect, the IRS said it will automatically refund that money to eligible people.
The IRS will begin sending the first refunds in May to roughly 7.3 million people, according to a report from the US Department of the Treasury. Refunds will continue through the summer, as the . In addition to this unemployment tax break, the March stimulus bill also extends the weekly bonus , authorizes a (what to know about ) and for up to .
Twenty-three million Americans filed for unemployment last year, according to the Bureau of Labor Statistics. Under, this included people who were laid off as well as gig workers, contractors and self-employed people who don’t normally qualify for unemployment insurance. We’ll explain the unemployment tax refund and the details we’re still waiting to learn. Here’s how to see if the IRS owes you and how to get a . This story has been updated with new information.
IRS unemployment tax refund: three main things to know
Unemployment tax refund details we’re waiting to learn
“This new clarification from the IRS is good news for the millions of taxpayers impacted, but may still be confusing,” said Mark Steber, chief tax officer for Jackson Hewitt. “Some taxpayers may have questions as to the timing of any payment and whether it will come in a check or other form.”
Steber also suggested checking in with a tax professional once you receive your automatic refund to make sure the IRS sent the right amount.
For more details, here are 7 ways to get, everything about the and what to know about the .