How You May Qualify for the $10,200 Unemployment Tax Break
By Kerrin N.T. Liu Generally, unemployment benefits are treated as income for tax purposes. However, a federal tax waiver of $10,200 for unemployment benefits received in 2020 was recently announced as part of President Joe Biden’s $1.9 trillion Covid relief bill. This tax break applies to the current filing season which runs until the postponed individual tax return deadline of May 17, 2021 (formerly April 15, 2021). For married couples, each spouse can exclude up to $10,200 of their benefits, reducing couples’ joint taxable income by up to $20,400 maximum. Any amounts exceeding $10,200 for each individual are still taxable. Only US taxpayers who earned less than an adjusted gross income of $150,000 in 2020 are eligible for the $10,200 unemployment tax break. The $150,000 restriction applies regardless of filing…