Modified AGI on 8962 not including Exempt Unemployment

Forum|Forum|5 years ago
April 6, 2021
1 reply
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My understanding of the character of the unemployment compensation, even the tax-exempt portion, is that it should be counted in modified AGI on Form 8962, similar to the non-taxable portion of social security benefits. At the this time Lacerte is not adding the exempt unemployment back for modified AGI on Form 8962.

To Lacerte community: Is anyone else observing this?

To Lacerte developers: Will this be corrected in an update soon? Otherwise we are having to calculate the modified AGI and adjust the "household income" field for the missing difference.

Lacerte Tax

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P

PamC

Level 6

I believe Form 8962 is under review due to the ARP payback provision. So there are changes to come. On Saturday, 04/04, Drake software notified their users that they had updated their program based on "Recent IRS guidance", however I haven't been able to find any such guidance on irs.gov.

https://www.irs.gov/newsroom/irs-letters-explain-why-some-2020-recovery-rebate-credits-are-different-than-expected

Hence the Lacerte diagnostic telling us to hold returns with a Form 8962