Form 1116 efile reject code F1116-012

[JMad]

Is anyone having a problem efiling a return with a Form 1116---reject code indicates using the smart worksheet to input detail for Line 2.  I have done this--you receive an error if this is not completed.  Return is still being rejected.

[Just-Lisa-Now-]

Does the return have Form 1116 Sch B included?  That B needs to be saved as a PDF and attached to the return or it will be rejected.   

Be sure when you attach it, in the Type of attachment you choose 1116 in the list, you need to scroll UP in that drop down list to find 1116.

[JMad]

yep, I have completed that step.  And it's not referring to the Schedule B.  I have filed so many 1116's with the line 2 expenses.  There is a "smart sheet" above that you need to give an explanation which I have also done. Keeps rejecting.  

[beanctr72]

YES!!!  I am having the same issue on two of my 1040's.  I have already added the explanation statements as well as attached the 1116 Sch B (different issue) and cannot get the returns to go through.  I am stumped.

[JMad]

I phoned Proseries yesterday and first was told to do a proseries repair and update my windows--which I had already completed but had to do again.  Then to try and efile again and if still an issue than I would need to call back and they would escalate.  Of course that did not help so I called back and spent over an hour on the phone all to be told that since there was a circle instead of a checkmark in the forms box, I was doing something wrong on my end and I needed to finish completing the 1116!  I tried to explain to this person that except for these explanation stmts, Form 1116 is not a form we fill in.  She said I might need zeros somewhere---SERIOUSLY????IIII   I have filed many returns previously that have the same type of scenario and now...as we approach a deadline, this occurs.  She would not escalate this any further because she said it is on my end.  So tired of paying so much money for software with zero support.  I wish someone could get a valid answer to this issue and QUICKLY.

[beanctr72]

POST UPDATE:  It didn't work after all....  Sorry. 😞

I found the solution!!!  You have to enter something in the State Income Tax Allocation Smart Worksheet box that's just above Line 2(a)(3) in the 1116 Comp Wks.  Totally not obvious and definitely not what the reject instructions state.

[JMad]

Unfortunately your resolution did not work.  I was hoping! 

[Skylane]

@IntuitGabi    Gabi,  we've been seeing numerous issues with the 1116 and attachments.   Anything that can be done to elevate this? Thanks

[JMad]

@IntuitGabi PLEASE!   And this issue is separate from the Schedule B for 1116.  As long as you attach Schedule B as a pdf and identify 1116 as the form, you are fine.  We are getting close to the deadline and i have 3 returns rejecting for this issue.

[beanctr72]

You're right!  I was so excited when it acted like it was going to go through - but it still Rejected!

[IntuitGabi]

This is what I'm able to find at the moment: F1116-012 from 2013 Business rules
Missing document "If for any country in Form 1116, Line 2 'ForeignIncRelatedExpensesAmt' has a non-zero value, then [ForeignIncmRelatedExpensesStmt] must be attached to Line 2" 

Part 1 line 2: "Expenses definitely related to the income on line 1a (attach statement) "
"... if you are reporting foreign business income on line 1a, include on line 2 business expenses such as supplies and advertising incurred as part of operating the foreign business. " From 1116 Instructions 
Help article: Attaching PDFs to business returns for e-filing in ProSeries Professional 

If you continue to have troubles contact us. 

[JMad]

I am aware of this...this is what the reject explains.  There is a smartbox above line 2 with an "explain" button that you click on to put an explanation.  That creates an attachment to the return.  I have done this all filing season but now...at the 11th hour of the last deadline, Proseries has some sort of glitch and it is bumping the return.  NOONE at Proseries is able to help and they won't escalate the issue.  THe only way to attach a pdf to the 1116 is for the Schedule B.  

[beanctr72]

Has anyone been able to find a solution for this?  I have two returns that keep getting rejected with this error.  I have manually also attached the line 2 expense explanations.  I have updated.  I don't know what else to try.

[JMad]

Unfortunately I have had to begin paper filing returns and have at least another 8-10 returns that will need the same...which, in my opinion, is ridiculous.  I tried calling Proseries one more time, to no avail.  Very frustrated to say the least...unneeded time and expense.

[gingersnap]

I was having the same issue. After I got the error code I deleted my attachment and then reattached. It went through. Much to my surprise.

My next thought was going to be save schedule B as a PDF and then attach it to the return.

I still have more to file, so not sure if this works all the time.

[JMad]

This issue has nothing to do with the Schedule B attachment.  The Schedule B does need to be attached as a pdf and you receive an error until you make that attachment.

[Abhilash Jossy]

I have been receiving e-file rejection based on the Form 1116 line 3b ( Other deductions) and needs attachment. I have tried adding attachment and explanation but those didn't work.

Has anyone got any workaround on this issue ? please let me know.

Thank you in advance.

Abhilash.

[Just-Lisa-Now-]

I had one that insisted I add an explanation statement in the program, but it prompted me for that prior to completing the return (red error), it wasn't a rejection.

What kind of foreign tax are you claiming, is it from a 1099DIV or something else?  Did you have to fill out the 1116 manually or something?

[Abhilash Jossy]

Hi There,

I have created to source the wages which is excess of the FEIE limit to claim additional FTC.

There are passive, Treaty basket apart from General.

Also there is no red coloured indication which requires the specific input as well.

[MM394]

I have exactly the same problem. Is there any solution? I really appreciate if somebody let me know.

I hope Proseries fix this problem ASAP.

Thank you. 

[Abhilash Jossy]

I have a workaround here.

To begin, you need to remove the amount on line 3b and you need to manually calculate the correct amount to be shown on line 3g.

Override line 7 amount with the amount (Line 1a minus line 3g), so that you would arrive at the exact amount even if we didn't try this work around.

I believe this is a bug and hoping to be fixed ASAP.

[JMad]

What's interesting is that during the 2024 filing season through April 15 (2023) there was no issue...it all began while filing extended returns.  I had no issue through this April 15, 2024 filing season and now it's going to begin again for these extended returns?  This HAS to get rectified. I had to paper file way too many returns last October.

[MM394]

Thank you for your reply. 

>you need to remove the amount on line 3b...

You mean override line 3b with a blank?

Thank you.

[Abhilash Jossy]

Yes. that's correct.

[MM394]

Thank you for your reply, Abhilash. 

I completely agree with you, JMad.  Proseries has to fix this issue ASAP.

[Michelle7]

Has anyone found another option for this error?

[lalaurence]

Yes, we are having the same issue as well, and with no assistance from ProSeries.  Basically, he said we'd have to paper file.

[Michelle7]

So strange because I have the same info in other 1040 returns with no error.  Very frustrating that Proseries has known about this for almost a year (based on this discussion).

[beanctr72]

Yes, I am still having this problem as well.  Super frustrating to have to paper file my most complicated tax returns because of it.

[IntuitGabi]

@lalaurence @Michelle7 @beanctr72 Thanks for letting us know. I reached out to you for more information so we can investigate further. 

[beanctr72]

Thank you for reaching out, Gabi! I just uploaded the sanitized file to you.

[Michelle7]

I also uploaded a sanitized file.  Thanks so much for helping with this!

[Rob-W]

This worked for us:

We entered the Form 1116, Line 2 "Expenses definitely related" on Line 5, "Losses from foreign sources", instead.  The Line 6 totals remain the same.  To cover ourselves, we add the following note to both Line 2 and Line 5 and tick the box, "Print this note as part of the tax return for filing":

These are definitely related expenses that normally are entered on line 2. Trouble is, there is a ProSeries tax software glitch associated with the line 2 required statement that prevents efiling when an amount is entered on line 2.  Therefore the expenses are entered on line 5 as a workaround to permit efiling.

We hope this is helpful, and we hope ProSeries is able to sort out this issue with the IRS soon and fix it in the software.

[beanctr72]

Thanks so much for your help Rob - this worked for me!!!  Really appreciate you taking the time to reply and help out on this!

[Michelle7]

A Proseries rep called me and was able to resolve our problem based on reviewing the sanitized file.  Our issue was related to a second Form 1116. The error message was not correct which is why I couldn't resolve the problem on my own.  

[beanctr72]

I had exactly the same issue and uploaded a sanitized file but have yet to hear back from Intuit.

[Michelle7]

I heard from the rep late on Friday so hopefully you will hear back soon.  The rep made sure the second 1116 was activated on my screen before efiling.  The second 1116 was just a carryforward - no current year information was in that form.  I needed to put "various" as the country to activate the form then I was able to efile.  

[mrusso]

This worked for us as well.  Thank you.

[JMad]

It is sad that Proseries cannot correct this glitch as it has been ongoing for at least 3 years now.  But thank you for that workaround...we do returns that have many states attached and it becomes very cumbersome to have to mail the Federal and a bunch of states.

Thanks again.

[JMad]

While this helps with Line 2, it does not help with Line 3 "other deductions not related" rejection.

This is soooo terribly frustrating.   On Oct 9th, who has time to be paper filing their clients returns -- nor should clients need to be paying for certified mailings of returns.  Intuit has NO problem raising their fee every year.    Efiling is a big portion of the program---get this figured out Intuit!!!

[mrusso]

Totally agree!!!  I also have not been able to figure out the Line 3 error code.  Come on Intuit let's get this software glitch figured out!!!  This has been a multi-year issue.  FYI, while you must file a federal paper return, you may still be able to e-file your state return.

[JGrahamAtlCPA]

I'm having this same error (Line 3b F1116-013 error code).  Affects 7 returns, with anywhere from 6 to 10 state returns.  Facts are pretty much the same - All have a 1116 for Foreign Branch bucket and a 1116 for General Limitation bucket (a couple also have a 3rd 1116 for passive income bucket). Have attached PDFs and re-filed to no avail.  All have had the same fact pattern since TCJA, but this week is the first time I've had this problem.  Paper filing at this stage is not an option.  

[JMad]

so we did a work around--not necessarily accurate but does not change any of the numbers.

I clicked into  Line 3b and determined what those deductions were.  Then on the lines below that are available for input, I listed those items (ie health savings account, se tax etc) and input the dollar amount as a negative which created a zero balance on line 3b.  Then I went above to Line 3a(5) Other and on the open lines b and c and I listed those same items and their dollar amounts.   So essentially on the Form 1116 line 3b is zero and Line 3a includes the 3b amounts.  Hope this helps...I am in the same boat you are.   Goodluck.

[JGrahamAtlCPA]

Thanks!  Will try.  Six of the 7 affected returns have disaster area extensions, so I've got a little extra time, but this is really frustrating.