The IRS is sending out refunds averaging $1,189 to 430,000 taxpayers. This is the latest batch of refunds based on American Rescue Plan Act (ARPA) changes made after many taxpayers had already filed their 2020 returns. Generally, unemployment benefits are taxable income. But, for 2020, the ARPA allows taxpayers with modified adjusted gross income under $150,000 to exclude unemployment benefits of up to $10,200 from taxable income. Rather than requiring taxpayers who had already filed to amend their returns, the IRS has been adjusting returns and automatically issuing refunds as appropriate. To date, 11.7 million refunds have been issued. For most qualified taxpayers, no action is required.