The IRS has recently provided updated guidelines concerning the tax implications of specific state payments associated with general welfare and disaster relief amidst the COVID-19 pandemic. As a result, the agency is now advising certain taxpayers who filed their returns early to consider making amendments. On February 10, the IRS issued this guidance to address concerns regarding the taxable status of these payments. Although the state payments were not intended to be taxed, numerous taxpayers included them as part of their income when filing their returns before the issuance of the guidance. Consequently, the IRS urges taxpayers to review their returns and potentially amend them if necessary.
