Spotlight On: 2020 Unemployment Compensation Exclusion!
- The American Rescue Plan Act from 2021 retroactively excluded up to $10,200 in unemployment compensation from federal taxable income for tax year 2020.
- At that time, a Department rule provided that retroactive changes in federal law did NOT affect a taxpayer's Colorado income tax liability.
NOW
- A recent court decision determined that the rule was incorrect and that retroactive changes in federal law CAN affect a taxpayer's Colorado taxable income
- Eligible taxpayers who did NOT previously exclude up to $10,200 of unemployment compensation from the federal taxable income reported to Colorado, OR who added back the excluded amount of unemployment compensation, may amend their 2020 income tax return to claim the exclusion.
Click the link below for more information and amended 2020 return filing deadlines:
2020 Unemployment Compensation Exclusion
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