Unemployment and 2020 tax returnsUpdates related to the American Rescue Plan Act of 2021
If you received unemployment (also known as unemployment insurance), the American Rescue Plan Act of 2021 reduced your federal adjusted gross income (AGI) for 2020 tax return.
This means you may now qualify to receive more money from California tax credits, such as:
- California Earned Income Tax Credit (CalEITC)
- Young Child Tax Credit (YCTC)
- The Golden State Stimulus payment
Many people do not have to do anything to receive these additional benefits.
New income calculation and unemployment
The American Rescue Plan Act of 2021 excludes a certain amount of unemployment from your federal AGI for your 2020 tax year, based on your filing status:
- Single: You will exclude up to $10,200 from your federal AGI
- Married filing jointly/registered domestic partners: You will exclude up to $20,400 from your federal AGI
What you need to do and payment timeframes
Your next steps depend on what you’ve done so far. To report your federal AGI and California tax credits correctly, find the scenario that applies to you.
|Scenario||What to do|
|Filed your 2020 tax return before March 11, 2021 and:
||You don’t need to do anything. We will make the changes for you. If you qualify for a bigger tax refund, you’ll receive it beginning August 2021.|
|Filed or will file your 2020 tax return after March 11, 2021 and:
||You don’t need to do anything. Your tax return will be processed with the updated requirements. Visit Wait times to review normal refund and return processing timeframes.|
|Filed your 2020 tax return and:
See if you qualify for CalEITC. If you do:
You do not need to amend your tax return.
See if you qualify for the Golden State Stimulus
Most people that qualify for CalEITC also qualify to receive a one-time Golden State Stimulus payment. For most Californians who qualify, you don’t need to do anything to receive the stimulus payment. Visit Golden State Stimulus for more information.