Your COVID-Related Tax Questions: Answered

Your COVID-Related Tax Questions:, Answered.

With tax season upon us, many are wondering how their new work-from-home status might affect their 2020 tax returns.

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Here are six of the most-asked COVID-related tax questions answered by tax professionals.

1.

Do I qualify for the home office deduction?.

You do qualify if you’re self-employed or an independent contractor.

If you get a W-2 tax form from your employer, you don’t qualify.

2.

Are there any new deductions I could be eligible for?.

If you qualified for but didn’t receive either of the stimulus checks in 2020, you’re eligible for the Recovery Rebate Credit.

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3.

If I work from home in one state but my employer is in another, which state income taxes do I pay?.

You typically only pay income taxes in the state you reside in.

If you performed work in both states before moving to a remote setup, you need to pay income taxes in both.

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4.

I temporarily moved to a different state in 2020.

How does this impact my taxes?.

Even if your move was only temporary due to COVID-19, you may still owe taxes in that state too.

The longer your stay, the more likely you have a tax obligation.

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5.

Do I need to pay taxes if I worked part-time and received unemployment benefits or compensation from a work-share program?

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Yes, because compensation received from a work-share program or Pandemic Unemployment Assistance is taxable income.

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6.

Do I need to pay taxes on the stimulus check I received in 2020?

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The stimulus check is not taxable income and won’t factor into your refund or any taxes you owe.

You do still need to record it on your tax return.