Updated: March 09, 2021 05:34 PM
Created: March 09, 2021 04:34 PM
ROCHESTER, N.Y. (WHEC) — The new stimulus bill offers a federal tax break for those of you who received unemployment benefits in 2020. The bad news? If you already filed your 2020 tax return, you’ll have to jump through a few hoops to claim it.
The bill is expected to be signed into law this week by President Joe Biden and says that the first $10,200 in jobless benefits will be non-taxable for households with incomes under $150,0000.
Right now, the IRS, accountants and tax preparation companies are doing the behind-the-scenes work to figure out how this will work.
“We are retroactively, in the middle of a filing season, passing a law that changes rules for 2020 that everyone's been following for almost 2 1/2 months now… The IRS does not have this programmed, it's not on the tax forms, it's everybody's worst nightmare from an administrative standpoint,” James P. Schnell, a CPA and Partner at Mengel Metzger Barr & Co., explained.
Just because you might be getting back some of the money you already paid in federal taxes on benefits collected in 2020 doesn’t mean you’re totally in the clear.
“Here's what we don't know, we do not know if New York State will follow suit on this for 2020,” Schnell said.
If you already filled your 2020 taxes but you think you’ll qualify for this credit you will need to file an amended return to get the money. If you haven’t yet filed, Schnell says you should wait.
“There is no harm in waiting another week or two to let this sort itself out,” he said.
A spokesman for the New York State Department of Taxation and Finance told News10NBC that the state is waiting until the president signs the bill into law to see the final language and then a decision will be made as to whether any state tax breaks will be offered.
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