![]() Read our full review for free and apply in just 2 minutes.Watch Video: Stimulus update: Another check and 'plus-up' payments coming soon Offer from the Motley Fool: If you have credit card debt, transferring it to this top balance transfer card can allow you to pay 0% interest for a whopping 18 months! That's one reason our experts rate this card as a top pick to help get control of your debt. It'll allow you to pay 0% interest on both balance transfers and new purchases until 2022, and you'll pay no annual fee. Top credit card wipes out interest until 2022 Its content is produced independently of USA TODAY. The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy. The Ascent does not cover all offers on the market. We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Keep an eye out for your unemployment tax refund and do your best to use that money in a way that gives you the most benefit – especially if your personal finances have not yet recovered from the impact of the pandemic. ![]() So the fact that you may be getting a break on $10,200 of benefits is an opportunity you should embrace. Normally, unemployment benefits are fully taxable at the federal level. Your tax refund may be enough to help you put money down to get a car, thereby opening up your options. Finally, you may be struggling to find work you can access via public transportation. Or, it could be that the type of job you want requires a college degree, in which case you could use your refund to help cover tuition. If you're lacking certain skills that make it tough to find work, you can use your refund to take a course to teach you what you need to know. If you're one of them, you may be able to use your tax refund to help yourself secure a new job. Though the jobless rate has fallen a lot since peaking a little over a year ago, many Americans are still out of work. Increase your chances of getting a new job The same holds true if you have a personal loan that's hanging over your head. Their reasons vary.īut if you're carrying high-interest credit card debt that's costing you a lot of money, then it pays to use your tax refund to pay some of that debt down. Unemployment assistance: These 9 states will end participation in unemployment assistance programs. Tax Day is Monday: How do I file a tax extension for 2021? There's generally no need to rush to prepay a mortgage because interest rates are usually low. And of course many people entered the pandemic with debt hanging over their heads. Pay off some costly debtĪ lot of people had no choice but to rack up debt during the pandemic. If you can boost your cash reserves so you have more – about six months' worth – even better. ![]() Generally speaking, it's a good idea to have at least three months of essential living expenses in your savings account. So if your emergency fund needs work, put your tax refund directly into savings. ![]() If the pandemic has taught us anything, it's the importance of having money in the bank for unplanned expenses or circumstances. If you're getting a refund for the taxes you paid on unemployment income last year, here are some things you can do to maximize the impact of this IRS refund. Stimulus checks: IRS sends nearly 1M more COVID relief payments, including 'plus-up' payments And while the IRS hasn't said how many taxpayers in total it expects to issue refunds for due to this change, that number could climb substantially by the time this year's tax season wraps up. So far, a good 7.3 million tax returns processed by the IRS are due a refund based on the tax-free unemployment rule. This means that a lot of people who received jobless benefits last year are in line for a refund on their 2020 taxes, which are due May 17. The relief package also boosted unemployment for those still collecting jobless benefits while also making $10,200 in unemployment benefits tax free for 2020. The $1.9 trillion American Rescue Plan is perhaps best known for putting $1,400 stimulus checks in Americans' bank accounts. Watch Video: 2020 taxes: Do you owe taxes on stimulus checks or unemployment?
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