If you filed your taxes early and received unemployment income in 2020, you may receive a refund from the IRS.
IRS announced Wednesday that it will be sending refunds to some Americans who were received unemployment compensation in 2020.
Unemployment is considered taxable income, but the American Rescue Plan, which was signed into law earlier this month, allows some unemployment income to be excluded. The law allows Americans earning less than $150,000 to exclude up to $20,400 on unemployment income if married filing jointly and $10,200 for all other eligible taxpayers.
The change only applies to unemployment income received in 2020.
Because the law was signed during the midst of tax season, some Americans had already filed 2020 taxes. For those who already filed taxes and were eligible for the deduction in income, the IRS said it will be sending refunds starting in May and continuing through the summer. The IRS said that these refunds will be automatic, and that affected Americans will not need to submit an amended return.
Federal data found that 23 million Americans received unemployment benefits at some point in 2020.
If you have not filed taxes for 2020, the IRS has published information to help taxpayers navigate submitting unemployment income.
