![]() ![]() She also received a direct deposit of that amount, plus interest. As a result, you are due a refund of $xxx.xx". In late July, she received a mailed CP21B from the IRS with a "Decrease in tax" and the notice "We changed your 2020 Form 1040 because of recent tax laws, rulings, or regulations required us to correct your unemployment compensation. Line 15: Due to above changes, child tax credit restructured and return Line 14: Due to above changes, EIC credit taken based on now meeting Line 7: Credits reduced to prevent credits from exceeding total tax Line 6: Tax amount reduced due to decrease on Line 5 Lines 1, 3, 5: AGI reduced by $xxxx due to change in Schedule 1Įxempting up to $10,200 in unemployment compensation for 2020. ![]() On the 1040X, we provided the following info to the IRS in the "Explanation of changes" on the 1040X (I've redacted actual values): We e-filed a 1040X for her through TurboTax back in March. This resulted in a decrease initially in her tax liability of $237, bringing her tax liability to $0.Ģ) Because of Line 1, it also brought her below the income threshold to make her eligible for the EITC, which she was not eligible prior to this change.ģ) Her child tax credit also changed due to the above changes. Specifically, changes made after she had originally filed and received her initial refund were:ġ) The amount of unemployment compensation she originally claimed as taxable income was offset by the stimulus changes. My fiancee's tax return fell into the trap of being eligible for additional tax credits/adjustments due to the stimulus act. ![]()
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