4 million unemployment refunds in July: transcripts, IRS schedule and more

If you paid taxes on the unemployment benefits you received in 2020, you could receive a payment from the IRS this summer. The agency evaluates tax returns and issues series of payments to those who are eligible. A batch of refunds was paid last week to nearly 4 million people, the tax agency said. But not everyone has received their refund, and some taxpayers say they don’t know the status of their money.

The first $ 10,200 of 2020 unemployment benefits – or $ 20,400 for married couples filing jointly – were declared tax-free income by the American Rescue Plan in March. About 13 million taxpayers were potentially eligible for an adjustment and refund because they overpaid when they filed their taxes before the bill was passed. The average refund is $ 1,265, the IRS said, but you could get more or less, depending on your income and other factors.

An IRS bank transaction code TREAS 310 could mean that your tax return has been adjusted and your refund has been filed. (By the way, if you’re a parent, that could also mean you got your first payment of the child tax credit this week.) Read on if you want to know how to access your tax slip for clues on the status of your refund. For more unemployment news, see which states are ending the $ 300 weekly bonus. We can also tell you how your child tax credit could affect your taxes in 2022. We continue to update this story.

10 Key Facts About IRS Unemployment Benefit Refunds

In late May, the IRS began reimbursing taxpayers who collected unemployment benefits in 2020 and paid taxes on that money before the US bailout went into effect. This law removed taxes up to $ 10,200 in unemployment insurance benefits for people earning less than $ 150,000 a year.

The first batch of these additional refunds went to those with the least complicated returns (single taxpayers with no dependents), and the batches are expected to continue throughout the summer for more complicated returns. According to an igotmyrefund.com forum and another discussion platform on Twitter, some taxpayers who declared themselves heads of households or married with dependents began receiving their money from the IRS in early July. Others seem to be receiving updates on their transcripts with the dates of July 14 or 26.

On July 13, the IRS announced it was sending an additional 4 million payments by direct deposit and paper check.

Here’s a quick recap of what we know:

• The tax break only applies to those who earned less than $ 150,000 in adjusted gross income and for unemployment insurance collected during the pandemic in 2020.
• The amount of $ 10,200 is the income exclusion amount for single tax filers, not the amount of the reimbursement. The amount of reimbursement will vary per person depending on overall income, tax bracket and amount of income from unemployment benefits.
• Most taxpayers do not need to file an amended return to claim the exemption. But if you think you are now eligible for deductions or credits based on an adjustment, check out the recent IRS publication for the list of people who must file an amended return.
• If the IRS determines that you are entitled to a refund on unemployment tax relief, it will automatically correct your return and send a refund without any further action on your part.
• Not everyone will be reimbursed. The IRS can seize the refund to cover past due debt, such as unpaid federal or state taxes and child support.
• Refunds began to flow in May and will be made in batches throughout the summer as the agency assesses the tax returns. More complicated returns may take longer to process.
• The IRS performs the recalculations in stages, starting with single filers who are eligible for tax relief of up to $ 10,200. It will then adjust returns for married and jointly filing taxpayers, who are eligible for tax relief of up to $ 20,400.
• Refunds will be made as a direct deposit if you provided bank account information on your 2020 tax return. A direct deposit amount will likely appear as “IRS TREAS 310 TAX REF. Otherwise, the refund will be sent as a paper check to the address the IRS has on hand.
• The IRS will send you a notice explaining the corrections within 30 days of the correction.
• Some states, but not all, are adopting the unemployment exemption for 2020 state income tax returns.

Find your tax slip to see the details of your unemployment refund

The IRS says eligible people should have received Form 1099-G from their state unemployment agency showing in Box 1 the total unemployment benefits paid in 2020. (If you didn’t, you must apply for one online.) Some states may issue separate forms. depending on unemployment benefits – for example, if you have received Federal Pandemic Unemployment Assistance, or PUA.

One method of knowing if a refund has been issued is to wait for the letter the IRS sends to taxpayers whose returns are corrected. These letters, issued within 30 days of the adjustment, will tell you if it resulted in a refund or if it was used to offset a debt. IRS says not call the agency.

You can try the IRS’s online tracking apps, aka the Where’s My Refund Tool and the Amended Return Status Tool, but they may not provide information on the status of your tax refund on the. unemployment.

One immediate way to see if the IRS has processed your refund (and for how much) is to view your tax records online. You can also request a copy of your transcript by mail or through the automated IRS telephone service by calling 1-800-908-9946.

Here’s how to check your tax slip online:

1. Visit IRS.gov and sign in to your account. If you haven’t opened an account with the IRS, it will take some time as you will need to take several steps to confirm your identity.

2. Once logged into your account, you will see the Account Home page. Click on View tax records.

3. On the next page, click on the Get the transcript button.

4. Here you will see a drop-down menu asking why you need a transcript. To select Federal tax and leave it Client file number empty field. Click it To go button.

5. The next page will display a Restore the transcription, Account statement statements, Account transcription and Salary and income Transcription for the past four years. You will want it 2020 account transcription.

6. This will open a PDF of your transcript: Focus on the Transactions section. What you are looking for is an entry listed as Refund issued, and it should have a date at the end of May or June.

If you don’t have it, it probably means the IRS hasn’t obtained your return yet.

Details we expect from unemployment reimbursements

The IRS has provided only limited information on taxes and unemployment benefits on its website. We’re still not sure exactly about the payment schedule (they’re a bit sporadic), which banks get direct deposits earlier, or how to contact the IRS if there’s a problem with your tax relief refund.

Also, since some states fully tax unemployment benefits and others do not, you may need to dig to see if the unemployment tax relief will apply to your state income taxes. This chart from the H&R Block Tax Preparation Service might give some clues, as well as this state-by-state guide from Kiplinger.

here’s how track the status of your tax return and reimburse online and what we know about contacting the IRS to dunning control issues. To learn more about stimulus payments and emergency aid, here is information on child tax credit up to $ 3,600 per child and details on who qualifies.