What are the steps to increase the Standard Deduction for casualty loss using Proseries Basic?

[IRonMaN · Accepted solution]

The standard deduction, is the standard deduction. You don't increase it unless you hit age 65 or go blind.

[fiveotax]

New tax law allows casualty loss to be added to the standard deduction.  It's a software question.  Basically it looks like it's done on the Schedule A where the standard deduction is entered as a Misc. ded. and the casualty loss is added to it.  I can't get the software to do this.  

[IRonMaN]

That’s a new one for me.

[rbynaker]

Is that for all casualties or just for Harma casualties? (Harvey, Irma, Maria)

[poolcleaner]

Personal casualty losses for tax years 2018 through 2025 are allowed only if they occur in a Federal Disaster area.

[rbynaker]

2016 + Harma + 2017 CA fires:

https://www.irs.gov/pub/irs-pdf/i4684.pdf

Qualified disaster loss. A qualified disaster
loss is an individual’s casualty or theft loss of
personal-use property that is attributable to a
major disaster declared by the President under
section 401 of the Stafford Act in 2016, as well
as from Hurricane Harvey, Tropical Storm
Harvey, Hurricane Irma, Hurricane Maria, or the
2017 California Wildfires. If you suffered a
qualified disaster loss, you are eligible to claim
a casualty loss deduction, to elect to claim the
loss in the preceding tax year, and to deduct the
loss without itemizing other deductions on
Schedule A (Form 1040). See Pub. 976 for
more information.

[fiveotax]

My client qualifies on all counts.
I could do this if filling out the form by hand.
I'm asking how to do it using ProSeries Basic software.

I can't get it to enter the descriptions on the line.
 
From IRS instructions for Schedule A line 16:
Increased Standard Deduction Reporting

If you have a net qualified disaster loss on Form 4684, line 15, and you aren’t itemizing your deductions, you can claim an increased standard deduction using Schedule A by doing the following.

List the amount from Form 4684, line 15, on the dotted line next to line 16 as "Net Qualified Disaster Loss," and attach Form 4684.

List your standard deduction amount on the dotted line next to line 16 as "Standard Deduction Claimed With Qualified Disaster Loss."

Combine the two amounts on line 16 and enter on Form 1040, line 8.

Do not enter an amount on any other line of Schedule A. For more information on how to determine your increased standard deduction, see Pub. 976.

  

[fiveotax]

It's been two weeks and Intuit still hasn't fixed this problem.  Should I continue to wait or just do the Schedule A by hand and have the client mail it in?

[Just-Lisa-Now-]

I believe it worked in the 2017 program when I had wildfire victims...the casualty loss added to the standard deduction.....darn, what was that clients last name....let me go digging....

[Just-Lisa-Now-]

ok, I found them...looks like the program did it all on its own.  I just filled out the 4684 and it automatically went where it was suppose to go.

I ended up with a Sch A Itemized Deduction Explanation statement at the end of the return that showed:

Line 28 Other Misc. Itemized Deductions not subject to 2% limitation.

Net Qualified Disaster Loss   24047
Standard Deduction Claimed with Qualified Disaster Loss  12700

and the total of 36747 showed up on Line 29 of Sch A and well as Line 40 of the 1040.

[fiveotax]

I'll look for the statement at the end of the return.   The IRS instructions say the statement should be on line 16 of Sch A on the dotted line.  

[Just-Lisa-Now-]

ohh for 2018, maybe    I was looking at a 2017 return, so the line numbers are different....

I don't have any 2018 clients with federal disaster losses, sorry.

[Just-Lisa-Now-]

Does the 4684 have your disaster listed?

[cajunlady]

when enterring your casualty loss   you have to check box E   federal declared major disaster..  For Hurricane IDA   on Line J   you have to enter DR-4611

The program will automatically add your standard deduction to your casualty loss

however..   i have this one client that it double dipping.  and I dont know why.   it is adding the deduction of schedule A with the casualty loss   plus adding the casualty loss..   do it is claiming loss twice..  

dont know how to fix this.   If i click that it isnt a federal declared disaster.   it doesnt allow me to deduct the loss..       anyone have this issue?

[cajunlady]

ignore my comment on double dipping.   i suppose it just seemed so high!   but when i added the loss and the standard deduction   it came out to that!