When to expect refunds for unemployment benefits
If you collected unemployment benefits in 2020 and filed your return before March 11 you could be due an additional refund. The American Rescue Plan of 2021 treats the first $10,200 ($20,400 MFJ) as non-taxable for individuals and couples with an adjusted gross income of less than $150,000.
This means if you filed your return before the plan was passed into law and reported 100% of your unemployment benefits as taxable you could be due a refund. The IRS will automatically adjust returns and issue refunds so there is no need to amend your return.
The IRS began to issue these refunds mid-May and will continue throughout the summer. They started with single taxpayers with no dependents and will work their way through more complicated returns as the summer continues. The second round of payments is likely to start mid-June and it is expected that married couples with dependents will receive their refunds later in the summer. If you provided direct deposit information on your 2020 return you will receive your refund this way, otherwise it will come by check. You should also receive a letter from the IRS regarding the correction within 30 days of processing the change.
You will not be able to use the “Where’s My Refund” application to determine the status of these refunds. You can set up an account at www.irs.gov to get a copy of your transcripts which could provide more information on the status of the refund.