WASHINGTON (WJW) — The American Rescue Plan was approved on March 11 and it provided qualifying Americans with stimulus check payments, a $3,600 child tax credit and more weeks of bonus unemployment checks.
According to the U.S. Dept. of Labor, the plan will provide an additional $300 in weekly unemployment benefits and continue $100 for Mixed Earner Unemployment Compensation through Sept. 6, 2021.
The bonus checks will run for a period of 25 weeks. It is unclear at this time if they will be extended.
The American Rescue Plan also included a $10,200 tax exemption for unemployment insurance recipients. Taxpayers who earned less than $150,000 in modified adjusted gross income are allowed to exclude unemployment compensation up to $20,400 if married filing jointly and $10,200 for all other eligible taxpayers. The legislation excludes only 2020 unemployment benefits from taxes.
The Internal Revenue Service (IRS) recently announced it will automatically refund money to people who filed their tax return reporting unemployment compensation before the recent changes made by the American Rescue Plan. The IRS says refunds will be sent to those who qualify beginning in May.
The IRS has also issued guidance on how to use the tax exemption for unemployment insurance when filing your taxes.