The COVID-19 pandemic has caused federal, state and local governments to implement measures to help support their economies. Tax, trade, and other authorities around the world are responding with regulatory change, relief measures, and extensions.
If you filed for unemployment for the first time, you'll see that if you received benefits, they will be federally taxable.
“Unemployment is federally taxable,” said local accountant Katherine Caldwell. “So if you’ve been receiving unemployment, you are going to get a 10-99 and you are going to get taxed on that and that could be a new thing for a lot of people who have never had unemployment before.”
You will also not be required to itemize charitable donations to nonprofit organizations. Instead, individuals can file for up to $300 in cash donations. School supply deductions for school teachers will also include any COVID-19 personal protective equipment purchased over the year. In addition to these changes for this tax season, citizens will also be able to use their earned income from the previous year, 2019, to qualify for their earned income credit.
“I was just really surprised you could go back a year,” said Caldwell. “A lot of people are going to be going down in income, getting less EIC, so they’re saying, ‘no you can use that 2019 amount to put you higher on that bell curve again.'”
Federal income taxes are used to support national programs, such as law enforcement, veteran and foreign affairs, national defense, and community development.
U.S. citizens will have until April 15 to file their 2020 taxes.