Taxing time: How the pandemic will affect filing your taxes

Tax filing season will start a bit later this year and look a bit different too. That’s because the pandemic that defined 2020 has seeped into tax time too. If you worked from home, received a relief payment, took on some gig work or filed unemployment benefits — or someone filed a fake claim in your name — there are things you need to be aware of. Likewise if you normally receive certain tax credits.

The IRS will begin accepting tax returns on Feb. 12. Here’s what you should know before you file:

___

UNEMPLOYMENT

Unemployment benefits are taxable income, which may surprise some filers.

Workers are not required to have federal taxes withheld from their benefit payments. While they are given the option to have it withheld, few opt to.

Additionally, unemployment benefits are always subject to federal taxes, but a handful of states do not tax it.

___

RELIEF CHECKS

The two rounds of economic impact payments sent to millions of Americas are not taxable income. But people who did not get their payments, or received less than they were due, can get the proper amount by claiming the Recovery Rebate Credit on their 2020 taxes.

As a reminder, the first round of payment was worth up to $1,200 per eligible adult and $500 per dependent; the second was worth up to $600 for each eligible household member. Those who received a larger economic impact payment than they were due will not be penalized.

It's also worth noting that while no one has to pay tax on this income at a federal level, some states are taxing it.

___

HOME OFFICE

Working from home became the norm for many in 2020, but few will be able to claim their expenses for their new home office setup. That’s because the home-office deduction can only be taken by...