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new covid bill march 2021-unemployment benefits nontaxable $10,200

vcmichele
Level 1

R most waiting to file, or planning on doing amended returns?  I have a way to correct this now and complete the return.  Federal forms additional income (line8 other income) type in description

Unemployment non taxable per covid bill 3/21   -$10200 (negative number)....in Calif ui is not taxable already, so than I need to correct under calif adjustments other income and add back the $10,200. I show

the correct ui amount as reported on form 1099G so it will not trigger a mismatch letter from the IRS.

I will not do the above until I hear from "proseries" if they will do a program correction within the next

week or so.

Any comments?

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qbteachmt
Level 15

"I have a way to correct this now and complete the return. "

Did you want to Wait until the bill gets passed by the House and then Signed by the President and becomes a Law?

Because right now, your computation isn't how it is written, and there is a lot of grumpiness about passing the bill as currently written.

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TaxGuyBill
Level 15

@vcmichele wrote:

 Federal forms additional income (line8 other income) type in description Unemployment non taxable per covid bill 3/21   -$10200 (negative number)..


 

Absolutely don't do that until (a) it actually becomes law and (b) the IRS says what THEY are doing.

It is POSSIBLE the IRS will automatically fix/change things on the non-updated forms.  If the IRS were to do that, you would be manually adding the deduction and then the IRS would add the deduction again.

No, ProSeries can't do anything until (a) it actually becomes law and (b) the IRS figures out what to do and tells the software companies what to do.  If the IRS does not automatically do things, I suspect it will be close to a month until things are ready.

Just-Lisa-Now-
Level 15
Level 15

Its not even signed into law yet, we've see NO guidance from IRS as to how this will be reported,  what about marketplace insurance, will it still use the total amount of UI (similar to how they use the total amount of SS income) to come up with MAGI, or not?


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
abctax55
Level 15

@vcmichele 

You "are" factoring in the $ 150,000 issue too?

AND backing off the appropriate above the line deductions to get to that $ 150,000?  

AND you must know the answer to whether that $ 150,000 issue is a cliff, or are things prorated if the appropriate AGI is above $ 150,000?  Please share.

AND you are taking into account whether both T & S have unemployment.

AND...

 

Former Chump..oops..AllStar...I used to be a people person, then people ruined it


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Just-Lisa-Now-
Level 15
Level 15

" if they will do a program correction within the next week"

Now thats hilarious, we will not see any update within a week.


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BobKamman
Level 15

Everyone talks about IRS red flags but too few have a problem when one actually pops up.

What do you think it does to your audit-potential score when you start putting five-digit negative numbers on the "other income" line?  And who do you think is reading your explanation, whether in a digital e-file or on a paper return?

If you must do something before sunset (for no good reason), then don't put the excluded income on Line 7 in the first place.  This might raise another red flag, though, if there is tax withheld and no income to show as a possible source. 

(The original red flags were those attached to IRS employee returns, when they were processed in local district offices and all of them were audited.)

qbteachmt
Level 15

Pelosi is presenting on CSPAN right now. Are you watching?

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qbteachmt
Level 15

The subtitle was "Final Vote Shortly" and right now it is "Final Vote Next."

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qbteachmt
Level 15

Voting now; 12 minutes left.

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qbteachmt
Level 15

It passed 220 to 211.

The White House has stated that the President will sign on Friday and then tour to tout the bill.

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