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Waiting for an unemployment tax refund from the IRS? Here’s What You Need to Know



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Millions of Americans who received unemployment insurance last year are getting some money back.

Angela Lang / CNET

Did you get unemployment checks in 2020 and did you treat that money as income when you filed your tax return this year? Then you may need a tax benefit. Based on new rules under the American rescue planworkers cannot be taxed on the unemployment benefits they received during the pandemic. Because the new scheme was approved after many taxpayers had already filed, they are now eligible for one IRS Tax Refund for the first $ 10,200 (or $ 20,400 for married couples filing jointly).

While the IRS still processes tax returns and after reviewing the taxes paid on unemployment insurance, the tax authorities began sending out unemployment refund checks earlier this month and will continue throughout the summer. The agency said the amounts will vary; not every adjustment will result in a refund. We will explain the unemployment tax exemption here and tell you what we still don’t know.

You may also have heard about the many states opting out of the $ 300 Bonus Unemployment Benefits and other unemployment benefits starting next month. If you are a parent, you may also want to know details about the improved child tax credit, how much you could get for your family and information about the upcoming IRS child tax credit portals. This story was recently updated.

9 Things You Should Know About The Upcoming Unemployment Tax Refund

The IRS says it has begun to return taxpayers who treated their unemployment benefits as income on their taxes this year. Here’s what to expect:

  • The tax break is for those who have made less than $ 150,000 adjusted gross income.
  • According to the IRS, refunds began the week of May 10 and will continue throughout the summer as the agency reviews tax returns. More complicated returns may take longer to process. Those waiting for checks have posted their frustration on Reddit and Twitter over the slow rollout.
  • If the IRS determines that you owe a refund of the unemployment tax break, it automatically sends a check.
  • You do not have to file an amended tax return to claim the exemption. (Here’s how track your tax filing status and refund onlineSome who used tax software like TurboTax said they’ve seen their refund amount change as a result of the unemployment refund, even though they haven’t seen a check yet.
  • Refunds are made as a direct deposit if you have provided bank account information on your 2020 tax return. Otherwise, the refund will be sent as a paper check to the address that the IRS has available.
  • The IRS performs the recalculations in two stages, starting with some filers who qualify for the tax break of up to $ 10,200. It will then adjust the returns for those married-filing-joint taxpayers who qualify for the tax break of up to $ 20,400.
  • The IRS will send you a message explaining the corrections within 30 days of a correction being made.
  • You cannot track the progress of your refund through the IRS Get My Payment tracker, the Where is my refund tool, the modified Return Status tool, or another IRS portal.
  • The IRS may seize the repayment to cover any overdue debt, such as unpaid federal or state taxes and child support.






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Things we still don’t know about unemployment tax refund

The IRS has provided some information on taxes and unemployment benefits on its website. We still don’t know how to contact the IRS if there is a problem with your tax break refund. (Here’s what we know about contacting the IRS for stimulus check problemsWe have contacted the IRS for clarification.

For more information, here is information on the child discount up to $ 3,600 per child and who is eligible.




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