Client died in June 2019 while 2018 1040 on extension. We want to apply 2018 overpayment to 2019 tax but Lacerte disregards this and shows it as a refund. How to fix?

[bcardenas]

We did not pay the first and second quarter 2019 estimated tax since we planned to apply the 2018 overpayment which would cover them.  Client died in June 2019 while 2018 return is on extension. Everything was fine until I entered in the date of death on Client Information screen, and then Lacerte changed the overpayment to a refund instead of applying it to 2019.  Taxpayers will have a tax liability in 2019 since income was earned from January - June 2019, and we will file a final return for 2019.  How can I apply the 2018 overpayment to 2019?

[George4Tacks · Accepted solution]

Be sure  you entered the correct date of death 2019. Make an entry in Screen 7 for an override of the 2019 estimate and try again.

[bcardenas]

I did use the correct date of death in June 2019, and entered an override in Screen 7 for the amount to apply to 2019 tax.  It doesn't work.

[George4Tacks]

@bcardenas I used the following in Screen 7:
Apply overpayment ... code 4
Estimate options ....... code 1
2019 estimated tax [O] Amount of refund or a specific number to make it work the way I want

This worked for me

[abctax55]

Try overriding the 2019 tax to a large number to see if it will trigger the application of the  overpayment.

And I *assume* if you remove the DOD, the overpayment applies as you want?  Just to test if the DOD entry is the true culprit.

[bcardenas]

Yes, I tried overriding the tax applied with a large number.  And yes, when I remove the DOD the overpayment applies properly.