Why is Lacerte limiting Elementary and Secondary Education Expenses to $10k on a per taxpayer basis rather than a per beneficiary as specified in Notice 2018-58?

[toddcbad]

1099-Q. Why is Lacerte limiting Elementary and Secondary Education Expenses to $10k on a per taxpayer basis rather than a per beneficiary as specified in Notice 2018-58?

[rbynaker · Accepted solution]

It's broken.  They're not fixing it.  Override.

[toddcbad]

At least I know it now. I'm trying to figure out how to override with a California return where California doesn't comply.

[Kathi_at_Intuit]

Thanks for reaching out. Our development is aware of this and a fix is tentatively scheduled for 4/18.

[toddcbad]

Release out today adds state selection fields but does not fix the federal issue of Lacerte not allowing $10k per beneficiary without tax but still taxing more than $10k per taxpayer.

[toddcbad]

Still not corrected in the latest release. Any update on when this will be fixed?

[Kathi_at_Intuit]

@toddcbad I just checked and the new tentative date is this Thursday 5/8. I will check after the update and see if it is there.

[toddcbad]

Thank you

[Kathi_at_Intuit]

@toddcbad I updated and I do not see any change in the program. I will see if I am able to get any update on this tomorrow when I get into work.

[toddcbad]

Yes, new update 5/8/2019 - still not fixed.

[Kathi_at_Intuit]

The new tentative date for this is 5/22. I will keep an eye on it.

[TaxGuyBill]

The tentative date is only 18 months after the law passed?  Doesn't Intuit claim to be a company that has software that prepares tax returns?

[abctax55]

Yes, they do.  They don't discuss *timeliness* that often tho :smiling_imp:

[sjrcpa]

This one is taking longer than the 60% AGI charitable contribution. Are they waiting for an IRS Publication this time, too?

[toddcbad]

Two more updates and still not fixed. Last week's update at least added the ability to specify a beneficiary but it still inappropriately adds income to federal and does not add the income and penalty to California.

[Kathi_at_Intuit]

@toddcbad I would take a look at the Sch 1, line 21 worksheet to see what you do not agree with there for Federal. I would then suggest calling in to our support so that we would be able to take a look at your file. I do see that CA does not conform to federal and I have a return that is adding back on the Sch CA line 21 the amount for tuition earnings. Also, on the 540 line 63 I see an amount generating for tax attributable to Qualified Plans (3805P).

[toddcbad]

I have 2 benes entered each with $10k of qualified elementary and secondary education expenses and $10k distributions. The spouse is the recipient for both. The qualified amount is carrying to the worksheet for one but not for the other. This results in the earnings from one of them being included in income.

[toddcbad]

I just deleted both benes, hit firms, went back and added them back and now it works for federal. But, no add back for California.

[toddcbad]

Now I unchecked the spouse box on both and I get the add-back. I then checked the spouse box on both again and add-back goes away.

[Kathi_at_Intuit]

@toddcbad Morning. Thank you for letting me know. I will see if I am able to duplicate this.

[Kathi_at_Intuit]

@toddcbad I was able to duplicate it. It has been reported to development for their review. I have attached you to this and you will receive an update via email when one becomes available.

[toddcbad]

Thank you