Level 1

Solved

State tax refund is not being added to 1040

Forum|Forum|6 years ago
December 7, 2019
15 replies
40 views

The state tax refund is on the state tax refund worksheet but it does not make it to the 1040

ProSeries Professional

This topic has been closed for replies.

Best answer by IRonMaN

The problem was corrected back in January.

There was an alert issued on 11/26. The only problem with issuing alerts, if folks don't read them, they are pretty useless.

You can either manually check the correct box on each return, or for returns that you haven't worked on yet, you can delete the returns and transfer them again to correct the issue.

IRonMaNAnswer

Level 15

The problem was corrected back in January.

There was an alert issued on 11/26. The only problem with issuing alerts, if folks don't read them, they are pretty useless.

You can either manually check the correct box on each return, or for returns that you haven't worked on yet, you can delete the returns and transfer them again to correct the issue.

Slava Ukraini!

IntuitCharlene

News Author

Development is looking into this issue.

If the Income Taxes box is not checked on Line C of the State and Local Income Tax Refund Worksheet and it should have been then you would want to check that.

If you are sure the full prior year refund should be taxable this year you can skip making the manual adjustment and just check the box below line 4 for "Use this worksheet to complete taxable refund amount? - If no, skip this Smart Worksheet. Total refund from Line 1 column (b) will be reported as income."

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J

JOFI

Intuit Community Champion

This is an important glitch in the software this year that needs immediate correction. I just realized that, for all of the returns I have completed this year where there was a state refund reported, the State and Local Income Tax Refund Worksheet is showing that the taxpayer deducted general sales taxes on their 2017 return instead of Income taxes (Box 2 is clicked for Line C instead of Box 1), even when this was not the case at all. As a result, the state refunds are not being calculated as taxable income and the taxpayer's final liability is smaller than it should be.

Two questions:

1) Why has this problem not been corrected?

2) Why has Intuit not immediately notified all Proseries users of this important glitch and the need to manually override this default sales tax box click?

S

sjd32

Level 2

I just received a IRS notice for tax due because of the refund calc error..The notice includes penalty & interest.

It is absolutely ridiculous, that your answer is a Nov alert solves the problem..This is a calc error not some benign administrative notice..A calc error in any part of the program causes clients tax liabilities to be incorrect..two years later they get a notice from IRS...

Intuit has a duty to an immediate update to the problem and sufficient notice so this can be remedied to cause the least disruption..Again, its a calc error..we do not have time to manually recalc to assure accuracy..

I am sure many Pro Series users will begin to see IRS notices in regards to this matter...

Is Intuit going to reimburse the clients in some manner..should they pay the preparers for their time in

correcting these errors...

Intuit need to do more then a Nov alert and needs to do it now............

sjrcpa

Level 15

As preparers, we have a duty to review the tax returns before we release them.

Yes our software should be accurate, but the buck stops with us. Somewhere in the fine print of our purchase agreement and/or license Intuit also tells us this.

I have no expectation that Intuit will reimburse penalty and interest. But you can try asking.

Do lots of people actually have taxable state tax refunds these days? With the $10,000 SALT limitation I rarely see a taxable refund (nor did I in the old AMT days).

The more I know the more I don’t know.

rbynaker

Level 13

This thread has a date stamp of 12/7/2019 when everything was migrated to the new platform. If someone is having a problem now it's going to be a different error.

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