How do I get Lacerte to evenly split Unemployment Compensation from Joint return into MFS return?

[Shedid]

LOL. Dang it.

[qbteachmt]

"It's splitting the unemployment 50/50. And it's excluding UP TO 10,200 on each of their returns."

Yes, I thought that's what you expected all along. It's $10,200 per taxpayer, so MFJ would be $10,200 exclusion and MFS means each is $10,200 exclusion.

https://www.caltax.com/news/hot-news-and-notes/ui-exclusion-for-married-taxpayers-and-ppp-loan-and-i...

[Shedid]

I was expecting Lacerte to indeed split the unemployment. My 'expectations' as far as the exclusion allocation was never (and still isn't) clear.  I had already read Spidell. Some agree with that. Some don't.  The way it reads, the exclusion is per 'recipient', not per taxpayer.

[qbteachmt]

Alrighty, then. Let's review:

You want to file MFS, to get below the threshold for the UI exclusion.

You stand behind the allocation of reporting the income as not by payee name.

You expected the software to facilitate splitting the UI, to each taxpayer for MFS for CA.

However, now you disagree with the Update as implemented, because it also provides $10,200 exclusion for each tax payer. Even though the Act provides "per taxpayer" and you now have them MFS.

And Intuit had to use the guidance from the IRS, and run the approval for their change past the IRS.

But now that they updated to accommodate what you needed and what you expected you disagree with their update for the part you were not sure of. And you don't accept what they seemed to be sure enough of, that it got released as an update.

Is there something more to be done, here?

[Shedid]

Finally 'some' guidance today from the IRS in FAQs posted on their site.  FAQ #4 under Eligibility:

https://www.irs.gov/newsroom/2020-unemployment-compensation-exclusion-faqs

Q4. I'm married and don't file a joint return with my spouse. We live in a community property state. Are we eligible for the exclusion? (added April 29, 2021)
A4. Yes. Because you live in a community property state, you report half of your unemployment compensation and half of your spouse's unemployment compensation on your tax return and your spouse reports the other half of your unemployment compensation and half of his or her unemployment compensation on his or her tax return. You should exclude up to $10,200 on your tax return if your modified AGI is less than $150,000. Your spouse should exclude up to another $10,200 on his or her tax return if your spouse's modified AGI is less than $150,000. Neither of you should exclude more than the amount of unemployment compensation you report on your Schedule 1, Line 7.

[Shedid]

A bit of guidance about community property MFS from the IRS website today with FAQs.  See FAQ #4 under Eligibility:

Q4. I'm married and don't file a joint return with my spouse. We live in a community property state. Are we eligible for the exclusion? (added April 29, 2021)
A4. Yes. Because you live in a community property state, you report half of your unemployment compensation and half of your spouse's unemployment compensation on your tax return and your spouse reports the other half of your unemployment compensation and half of his or her unemployment compensation on his or her tax return. You should exclude up to $10,200 on your tax return if your modified AGI is less than $150,000. Your spouse should exclude up to another $10,200 on his or her tax return if your spouse's modified AGI is less than $150,000. Neither of you should exclude more than the amount of unemployment compensation you report on your Schedule 1, Line 7.

[amec]

nvm - found it

[Shedid]

Glad you found it!! I did just add the link to the site to my original comment.

[George4Tacks]

WOW! Gold coins for Easter!!!!!!

https://www.irs.gov/newsroom/2020-unemployment-compensation-exclusion-faqs-topic-a-eligibility

Q4. I'm married and don't file a joint return with my spouse. We live in a community property state. Are we eligible for the exclusion? (added April 29, 2021)

A4. Yes. Because you live in a community property state, you report half of your unemployment compensation and half of your spouse's unemployment compensation on your tax return and your spouse reports the other half of your unemployment compensation and half of his or her unemployment compensation on his or her tax return. You should exclude up to $10,200 on your tax return if your modified AGI is less than $150,000. Your spouse should exclude up to another $10,200 on his or her tax return if your spouse's modified AGI is less than $150,000. Neither of you should exclude more than the amount of unemployment compensation you report on your Schedule 1, Line 7.

[Olofty1]

Per the IRS, living in a community property state DOES allow UNO to be split between each spouse.

https://www.irs.gov/forms-pubs/unemployment-exclusion-update-for-married-taxpayers-living-in-a-commu...

If you file a Married Filing Joint return, when completing the worksheet, you should report half of your unemployment compensation and half of your spouse's unemployment compensation on line 8 of the worksheet and your spouse reports the other half of your unemployment compensation and half of his or her unemployment compensation on line 9 of the worksheet. If your joint modified AGI is less than $150,000, you and your spouse can exclude up to $10,200 each. Do not exclude more than the amount of unemployment compensation you report on your Schedule 1, Line 7.

[Shedid]

Indeed.  I posted this resolution the day the IRS came out with the FAQs on April 29.  Was very happy to see that they came out with guidance in time for me to complete relevant returns by May 17!!