PORTSMOUTH, Va. (WAVY) – Friday, Feb. 12 is the first day you can file your 2020 tax returns. It’s expected to be a challenging tax season for many people with changes in employment and those stimulus checks related to the pandemic.
10 On Your Side reached out to Jackson Hewitt franchise owner Sherman Sidhu for some answers to your biggest questions.
“The number one question we’re getting is exactly what you asked, ‘Will the economic impact payments, or stimulus as most people say, affect my refund?'” said Sidhu.
The simple answer is no. He said, “You will not owe any money because of the stimulus payment.”
It will not affect your refund either, he said. However, you will have to list the stimulus money you received on your tax form. That is why some people are confused.
If you missed one of the stimulus payments, that is the government never sent it to you, Sidhu explained that you can claim it on line 30 of your 1099, and receive that money with your refund.
Sidhu said, “Every taxpayer should receive $1,200 for the first economic impact payment and $600 for the second economic impact payment.”
You get another $500 per dependent for the first stimulus check and $600 per dependent in the second round.
These stimulus payments are for people making up to $75,000 or for a married couple making up to $150,000.
“And there’s no difference whether you’re retired or still working,” Sidhu explained.
If you were out of work last year and collected unemployment you must claim that money as income.
“If you received Virginia Unemployment from the Virginia Employment Commission, it will not affect your Virginia tax return, but it is taxable on your federal return,” he said.
That means you do have to pay federal taxes on that money at the normal rate.
IRS Resources:
- About Form 1099-MISC
- IRS outlines steps to speed refunds during pandemic
- List of IRS tax tips for 2021
- Details on the Recovery Rebate Credit