Many people collecting unemployment before the passing of the American Rescue Act are now waiting for a refund.
The act made the first $10,200 of unemployment benefits no longer taxable income, but many had already filed their taxes before the law changed.
Now, the IRS needs to check all the returns to see who they owe money to.
It’s important to remember the $10,200 is just excluded from taxes, not a refund. Not everyone will qualify for a refund, unless they overpaid on taxes.
The average refund was around $1,265 for earlier checks, but the latest checks show an average of $1,189.
The exemption was given to workers making under $150,000. Married couples could exclude $20,400 of their earnings.
10 million Americans filed taxes before the law went into effect, but not all are due refunds.
How do I get the refund, when will I get the refund, and how do I check the status?
The IRS is checking people’s refunds, so it’s not necessary to file an amended return. The IRS is just adjusting taxes already sent in.
Refunds started being sent in May and continued through the summer. The first checks sent were for the most simple returns, and the complicated returns took longer. By July, 4 million refunds had been sent out.
Another round went out at the end of July.
Between August and October the IRS says it sent out 430,000 more refunds and all of these together were about $551 million dollars.
These types of refunds can’t be tracked, but those receiving them should get a letter telling them about any correction made within 30 days of it happening.
Another way to check is to view your tax transcript online with your account through the IRS.
By logging in you can check under View Tax Records, then Get Transcript. Choose the federal tax option and 2020 Account Transcript. Then check for entries labeled Refund issued.