However, if a taxpayer has unpaid tax or other specific governmental liability, the Department will first apply any overpayment toward these liabilities. If a taxpayer is eligible for a refund, the Department will issue a refund payment to the taxpayer and the taxpayer need not take any action. The Department of Revenue (“Department”) expects to send notices to taxpayers who reported unemployment to explain whether those persons may be eligible for relief. Taxpayers who have already filed their 2020 personal income tax returns and reported unemployment compensation as income should not file amended returns at this time.

A deduction of up to $10,200 may be claimed by each eligible individual for unemployment compensation received by that individual the deduction is not limited to $10,200 per return. The calculation of household income follows Section 36B(d) of the Internal Revenue Code and includes all of a taxpayer’s income, including unemployment compensation. 62, § 2, provided that the taxpayer’s household income is not more than 200% of the federal poverty level. However, Section 26 of the Act provides that, for the taxable year beginning on Januand the taxable year beginning on January 1, 2021, up to $10,200 of unemployment compensation that is included in a taxpayer’s federal gross income shall be deducted from federal gross income for purposes of determining Massachusetts gross income under G.L. Generally, unemployment compensation is taxable under G.L.

Mass unemployment tax break