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UNEMPLOYMENT EXCLUSION

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Level 2

MY UNDERSTANDING IS THE $10,200 EXCLUSION IF FOR MFJ AND AGI IS LESS THAN $150,000 AND SINGLE IS AGI IS LESS THAN $75000.  CAN YOU FILE MARRIED FILING SEPERATE AND USE THE $75000 AGI FOR THE TAXPAYER.  I HAVE A SITUATION OF A MARRIED COUPLE SHE MADE $98,000 AND HE MADE $58000 INCLUDING UNEMPLOYMENT.  CAN I FILE SEPERATE AND GIVE HIM THE UNEMPLOYMENT EXCLUSION. 

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12 Replies 12
Just-Lisa-Now-
Level 15
Level 15

Im not seeing where it shows that the 150k needs to be split for single. These IRS instructions dont mention Single or Married...can you provide a link to that information?


https://www.irs.gov/faqs/irs-procedures/forms-publications/new-exclusion-of-up-to-10200-of-unemploym...


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jgm6520
Level 3

I think you're correct but the real question is how do you give individuals or couples the credit? Are we going to get another version of the 1040?

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Just-Lisa-Now-
Level 15
Level 15

@jgm6520 wrote:

I think you're correct but the real question is how do you give individuals or couples the credit? Are we going to get another version of the 1040?


I dont understand your question....the IRS issued guidance on how to apply the exclusion, no extra forms or 1040 change needed.

https://www.irs.gov/faqs/irs-procedures/forms-publications/new-exclusion-of-up-to-10200-of-unemploym...


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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moore1
Level 1

There is no worksheet for line 8. Are you just going to put UCE and a negative number for the exclusion on line 8? Or will proseries add a unemployment compensation exclusion worksheet like the instructions issued by the IRS? 

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Just-Lisa-Now-
Level 15
Level 15
The worksheet just totals up the income included in that 150k limit...if your client is nowhere near the 150k mark, no worksheet needed.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
moore1
Level 1

So this will exclude it from the Ohio and school district income. Have they determined they will follow the federal mandate and exclude the first $10,200 as well?

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Just-Lisa-Now-
Level 15
Level 15
You'll have to look to your state for guidance on how they will handle it.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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tctxldy
Level 3

I think the question is...Will the tax program (Proseries) be making any updates to deal with this unemployment compensation situation or are we just to do it manually?

BobKamman
Level 13

you are confusing this with the $75,000 limit on economic impact payments.  so far irs has admitted that the $150K applies to both mfj and mfs returns, although watch for an announcement next friday night that they have changed their mind.  

qbteachmt
Level 15

This isn't correct: "MY UNDERSTANDING IS THE $10,200 EXCLUSION IF FOR MFJ"

It's $10,200 per each person on a joint return who collected unemployment. That means if one of them only got $8,000 UI and the other got $15,000, the other does not get to use the $2,200 difference and only has $10,200 excluded.

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PATAX
Level 9

👍 QB sounds like he is correct again... Doesn't appear to be a real complicated matter to me, just my opinion...

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Accountant-Man
Level 11

caps lock works.

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