Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

Unemployment Compensation Exclusion Change

caj111
Level 3

Another change happened to the IRS unemployment compensation exclusion today.  Now, when computing the $ 150,000 limit on income in order to exclude the unemployment compensation, you exclude the unemployment compensation itself from the calculation (see the link to the article). https://www.msn.com/en-us/money/taxes/the-irs-just-made-more-people-eligible-for-an-unemployment-ben...

So if my client's adjusted gross income amounts to a total of $ 152,000, and $ 9000 of this was unemployment compensation, in computing the $ 150,000 limit, my clients would considered to have received only $ 143,000 in total adjusted gross income.  Ultimately, this means they can exclude the unemployment compensation of $ 9000 from the total income, and my client's adjusted gross income will be $ 143,000.  The problem is that if I put in a negative $ 9000 on Schedule 1, line 8, this gets doubled on the return, because now my client's income is under $ 150,000, and the the prior change to the program gets applied resulting in $ 18,000 being subtracted from total income.

I know this IRS change just happened today but I don't see anything on this website and didn't get any email alerts about it.  Will a new workaround be developed for this?

 

Labels (1)
0 Cheers
1 Solution

Accepted Solutions
abctax55
Level 15

There's an alert at the top of this page, posted 8 hours ago, discussing the issue & pending update schedule.

Former Chump..umm... AllStar...This message was typed from 6 feet away so you can safely read it immediately.

If a post answers your question, click on *Accept as solution* for future searches

View solution in original post

3 Replies 3
abctax55
Level 15

There's an alert at the top of this page, posted 8 hours ago, discussing the issue & pending update schedule.

Former Chump..umm... AllStar...This message was typed from 6 feet away so you can safely read it immediately.

If a post answers your question, click on *Accept as solution* for future searches

View solution in original post

caj111
Level 3

Thanks, much appreciated.  I knew this change just happened today and didn't expect an instant update but I thought there would be some kind of alert or email and didn't see it.  Guess I didn't look all over the website.

0 Cheers
abctax55
Level 15

YVW....

MY suggestion to Intuit would be to make the announcement just a wee bit   B I G G E R

Former Chump..umm... AllStar...This message was typed from 6 feet away so you can safely read it immediately.

If a post answers your question, click on *Accept as solution* for future searches