On the Income Statement of a Schedule E rental on a multi-state return, we're supposed to be able to select the state for an expense item, and set Source to "S" to make the expense only appear on the state tax return. But that functionality doesn't work at all if the state is also the taxpayer's residence state (I'm using California in this case). Instead it completely ignores "S" source expenses and the expense never appears anywhere on the tax return at all.
I've run through this with multiple customer service agents, and it has come up as an issue for others as well. It appears to just be a bug in the software.
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.