IRS to send refunds to those who paid taxes on 2020 unemployment compensation

CNN– The IRS will send out millions of refunds for taxes paid on unemployment benefits. The agency is distributing upwards of 2.8 million refunds just this week. They are going to people who have already paid taxes on 2020 unemployment compensation, because of new legislation on the books that excludes those benefits as income. Therefore, taxes paid on the benefits now count as overpayments.

The IRS refunds mean most affected taxpayers will not have to file an amended return.