Southern Illinois News

Gov. J.B. Pritzker announced that the Illinois Department of Revenue (IDOR) would begin to issue tax refunds to taxpayers who filed their 2020 Illinois Individual Income Tax Return before the new federal unemployment tax exemption.

Approximately 3,300 paper filers who filed before the appropriate date will also be notified by the IDOR that they must file an amended return to be eligible for the refund.  

"The Federal American Rescue Plan Act of 2021 includes a retroactive provision making the first $10,200 per taxpayer (or up to $20,400 married, filing jointly) of 2020 unemployment benefits nontaxable for returns with a modified Adjusted Gross Income (AGI) of less than $150,000" said state Sen. Terri Bryant (R-Murphysboro) in a post to her Facebook account. "This means Illinois taxpayers who received unemployment benefits in 2020 may be eligible for a tax refund from the State of Illinois based on the exclusion of the $10,200."

No additional filing is necessary for those who filed on March 15 or later and included the unemployment exclusion on their federal and state income tax returns. An amended return is necessary for those who filed after March 15 and did not include the unemployment exclusion. In that case an amended return is necessary to calculate their AGI. 

Illinois taxpayers who claim an Illinois Earned Income Credit will be eligible for an additional refund in some cases as a result of the new federal unemployment compensation tax exemption.