Unemployment tax refund lacking? Here’s how to check without calling the IRS

The IRS routinely corrects 2020 returns and sends letters with the quantity of the unemployment tax refund.

Angela Lang/CNET

Massive IRS delays in processing tax refunds, together with to these eligible for the tax break on 2020 unemployment advantages, is inflicting monetary misery to taxpayers throughout the US. On high of extreme cuts and pandemic shortages, the tax company was tasked with sending out stimulus funds and implementing new guidelines beneath the American Rescue Plan that exclude from taxation the first $10,200 of 2020 unemployment benefits (or the first $20,400 for married {couples} submitting collectively). 

As many as 13 million individuals who filed taxes earlier than March doubtless overpaid on their unemployment compensation and may very well be due for an automated adjustment and refund. As of June 4, the IRS had despatched out greater than 2.8 million refunds. Yet two weeks after the anticipated second “mid-June” batch, many nonetheless have not obtained their cash. Since most calls to the IRS are going unanswered, annoyed taxpayers are sharing info via dialogue platforms on Reddit and Twitter

We can present you how to check your IRS account on-line to view its standing. As for different unemployment information, this is what to learn about states ending the $300 weekly bonus payments and that are providing return-to-work bonuses. And in the event you’re a mother or father anticipating your first child tax credit fee on July 15, we are able to let you know how these payments could affect your taxes subsequent yr. We have up to date this story lately. 

Nine issues to learn about IRS unemployment tax refunds

The IRS began sending refunds to taxpayers who obtained jobless advantages final yr and paid taxes on the cash early in submitting season. After some delays in the rollout, many single filers started seeing deposits of their checking accounts beginning May 28, with 2.8 million refunds going out the first week of June. 

The IRS stated the subsequent set of refunds for single filers will exit in “mid-June,” however these funds haven’t but been formally confirmed. More advanced returns (like these with dependents) had been supposed to take longer. The IRS has not issued a brand new timeline for unemployment compensation and has lately been centered on the rollout for the newly expanded youngster tax credit score, which begins this month. 

Here’s what to know:

  • The tax break is for individuals who earned lower than $150,000 in adjusted gross income
  • The $10,200 is the quantity of revenue exclusion for single filers, not the quantity of the refund. The quantity of the refund will fluctuate per individual relying on total revenue, tax bracket and how a lot earnings got here from unemployment advantages.
  • Not everybody will obtain a refund. The IRS can seize the refund to cowl a past-due debt, resembling unpaid federal or state taxes and youngster help. 
  • Refunds started going out in May and can exit in batches via the summer time as the company evaluates tax returns. More sophisticated returns might take longer to course of.
  • The IRS is doing the recalculations in two phases, beginning with single filers who’re eligible for the up-to-$10,200 tax break. It will then modify returns for these married-filing-jointly taxpayers who’re eligible for the up-to-$20,400 tax break.
  • If the IRS determines you’re owed a refund on the unemployment tax break, it’ll routinely right your return and ship a check or deposit the fee in your checking account.
  • Refunds will exit as a direct deposit in the event you offered checking account info in your 2020 tax return. Otherwise, the refund shall be mailed as a paper check to the handle the IRS has available.
  • You don’t need to file an amended return to declare the exemption. (Here’s how to track your tax return status and refund online.) Some who used tax software program resembling TurboTax stated they’ve seen their refund quantity change due to the unemployment refund, though they’ve but to see a check. 
  • The IRS will ship you a discover explaining the corrections inside 30 days of when a correction is made.

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Check the status of your refund online through a tax account

The IRS says eligible individuals should’ve received Form 1099-G from their state unemployment agency showing in Box 1 the total unemployment compensation paid in 2020 (if you didn’t you should request one online). Some states may issue separate forms depending on the jobless benefits — for example, if you received federal pandemic unemployment assistance, or PUA. 

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

The IRS online tracker applications, aka the Where’s My Refund tool and the Amended Return Status tool, will not likely provide information on the status of your unemployment tax refund. The only way to see if the IRS processed your refund online (and for how much) is by viewing your tax transcript. 

Here’s how to check online:

1. Visit IRS.gov and log in to your account. If you haven’t opened an account with the IRS, this will take some time as you’ll have to take multiple steps to confirm your identity.

2. Once logged into your account, you’ll see the Account Home page. Click View Tax Records.

3. On the next page, click the Get Transcript button.

4. Here you’ll see a drop-down menu asking the reason you need a transcript. Select Federal Tax and leave the Customer File Number field empty. Click the Go button.

5. The following page will show your Return Transcript, Records of Account Transcript, Account Transcript and Wage & Income Transcript for the last four years. You’ll want the 2020 Account Transcript

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

If you don’t have that, it likely means the IRS hasn’t gotten to your return yet. 

Unknown details about unemployment tax refund

The IRS has only provided some information on its website about taxes and unemployment compensation. We’re still unclear of the exact timeline for payments or how to contact the IRS if there’s a problem with your tax break refund. 

Here’s what we do know about contacting the IRS for stimulus check problems. For more on stimulus payments and relief aid, here is information about the child tax credit for up to $3,600 per child and details on who qualifies.

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