Unemployment Compensation Exclusion Update

IRS has provided detailed information regarding treatment of the unemployment compensation exclusion due to the recently enacted American Rescue Plan. The new legislation excludes from income up to $10,200 of unemployment compensation paid in 2020 for taxpayers whose modified adjusted gross income is less than $150,000. In the case of married taxpayers, each spouse does not have to pay tax on unemployment compensation of up to $10,200. Read more here.