The IRS Begins 2020 Income Tax Season While Dealing With Lingering COVID-19 Delays

It’s tax time, and you have questions. WDET gets answers from the IRS.

The Internal Revenue Service is now accepting 2020 income tax returns, even though it’s still catching up on 2019 returns.

The COVID-19 pandemic has caused a backlog at the IRS, according to Marielle Segarra of American Public Media’s Marketplace Morning Report.

IRS spokesperson Luis Garcia is asking people who are still waiting for their 2019 refund to be patient.

“Be assured that we’re doing the best we can and working as quickly as possible within the parameters allowed.” — Luis Garcia of the IRS.

What’s the holdup?

Part of the problem is that the IRS has offices in all 50 states, and must follow each one’s COVID-19 protocols. In some cases, Garcia says pandemic regulations forced many IRS employees to work from home.

“There was a point at the beginning of last summer where we had several semi-trucks in our processing centers that were sitting there with unopened mail because there was nobody to open it,” he says.

As those restrictions eased, more people returned to work and started opening returns. But Garcia says the IRS is still behind on processing those returns.

“Be assured that we are doing the best we can with what we have and are working as quickly as possible within the parameters,” Garcia says.

Click the player to hear IRS spokesperson Luis Garcia discuss the 2020 income tax season.

Pat Batcheller
Pat Batcheller

Why did I get a letter saying I haven’t paid my 2019 taxes?

Again, Garcia says that’s a function of the pandemic-related processing delays. He says there’s no need to worry if you filed your return with your payment.

“You’re not going to be penalized for any of our issues in processing your returns or payments,” he says.

Even if someone receives a notice of non-payment, Garcia says there’s a chance the IRS has processed your payment. He says taxpayers can create a personal account on the agency’s website to get more information.

“You can look at the returns that you filed, what you’ve paid, what you’ve received in refunds, and so on,” he says.

Can I deduct COVID-related expenses?

In some cases, yes. For example, teachers who bought personal protective equipment in 2020 can deduct up to $250 dollars in qualified expenses.

“That can include everything from masks to hand sanitizer, soap, tape, chalk and plexiglass,” Garcia says.

Self-employed taxpayers can also deduct the cost of PPE.

Do I have to pay taxes on my Economic Impact checks?

Congress authorized direct payments to millions of Americans to help boost the economy during the pandemic. Garcia says that is not taxable income.

“Whether you got the first or second payment, you don’t have to include that in your return,” he says. 

If someone was supposed to get one of those checks, but didn’t — or if they didn’t get the full amount — Garcia says they need to fill out a recovery rebate form in order to claim that money.

Do I have to pay taxes on unemployment benefits?

Yes, that is taxable income, and those who received unemployment benefits will receive a 1099-G form from the State of Michigan. The pandemic caused record unemployment in 2020, and Garcia says that led to an increase in unemployment fraud. He says people who get a 1099-G but did not lose their jobs are the victims of identity theft.

“If you get a mystery 1099-G, you want to make sure you contact the Michigan Department of Treasury and inform them that somebody has collected unemployment benefits under your name,” Garcia says.

What else do I need to know?

The standard deductions for 2020 are higher:

  • $25,100 for married couples filing jointly.
  • $12,550 for single filers or married persons filing separately.
  • $18,800 for heads of households.

The filing deadline, which was moved to July in 2020 because of the pandemic, returns to its regularly-scheduled date of April 15, 2021.

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  • Pat Batcheller is a host and Senior News Editor for 101.9 WDET, presenting local news, traffic and weather updates during Morning Edition. He is an amateur musician.