IRS to send another 4 million tax refunds to people who overpaid on unemployment

The U.S. is delivering another batch of tax refunds to Americans who received unemployment insurance benefits last year and may have overpaid taxes on them. The Internal Revenue Service announced Tuesday it will send 4 million tax refunds the week of July 14, with direct deposits landing in people's accounts that day and the agency mailing paper checks on Friday.

The refunds are for taxpayers who collected unemployment last year and who filed their 2020 returns before mid-March, when President Joe Biden's American Rescue Plan decreed that up to $10,200 in jobless benefits would not be taxable.  Because unemployment assistance is subject to federal income tax in most years, the tax law change meant that millions of people are due a refund. The IRS estimated as many as 13 million people may qualify for a payment. This is the third round of refunds the agency is issuing, after issuing  similar payments in May and June.