IRS Notice 2021-15: How to report?

[Jen5]

IRS Notice 2021-15 informs taxpayers that pre-tax child care can be carried forward to 2021 at the election of employers. I have a client that has this exact same situation because he was unable to use any of his amount in Box 10 from his W-2 form. His employer told him the company was changing the plan to allow for a carry forward of the W-2, Box 10 amount. When I enter his carry forward on Form 2441, Part III, Line 14, the return passes error and review check in ProSeries. I e-filed, and Intuit accepted the return.

The next morning, I have a rejection notice. It tells me that for each Care Provider entered there must be a corresponding amount paid. The problem is there were no child care expenses paid in 2020 due to the pandemic.

Has anyone else run into problems with IRS Notice 2021-15 when the client is eligible to carry forward the Box 10 amount from the W-2 form, but gets rejected by the IRS? How are we supposed to report this? If so, would you be so kind as to share your experience with it in e-filing a return? I would very much appreciate how other preparers are handling this situation. Thank you.

[TaxGuyBill · Accepted solution]

I have not encountered it, but I have two thoughts:

Don't enter a child care provider.

Or enter $1 paid to the child care provider.

[Jen5]

I filed an amended return today doing what you suggested. I took the $1 approach. It appears that everything is okay. Intuit accepted it.  I will not know for sure until tomorrow when I check to see if the IRS accepted it. Intuit accepted it the 1st time too, but only for it to come back rejected by the IRS.

The first time when it was rejected by the IRS, my reject notice mentioned Form 2441. Like an idiot and not remembering that that was the only place to put the Box 10 amount to bring forward, I deleted Form 2441, and resubmitted. The IRS accepted that one, but debited my client's bank $907.00 more than what he signed off on. I was in a real panic. Because I did that, it just complicated matters. That is where panic gets me.

You do not know how much I appreciated your response. It was answered prayer. I had talked with 2 Intuit Customer Help people about my problem, but they had no suggestions. I feel they left me out to dry. This issue cost me two days at my busiest time of the year.

I was going to wait until tomorrow to see if the IRS rejects the amended return I submitted today before I wrote to tell you how much I appreciated your help. I will let you know tomorrow if the IRS accepted the amended return I filed today. Thank you, thank you. I will post again tomorrow.

[TaxGuyBill]

You are very welcome.  I hope it clears through okay.

Feel free to come back and ask any other questions (we are usually better than calling "support") or to answer any questions for other people that may be having problems.

[Jen5]

The amended return was accepted by the IRS!!! I thank you again for helping me!

Are you serious about asking you questions anytime? I am a sole proprietor, and I so wish I had a person to ask when I get really stumped. When I worked for a firm, there were many more resources available. I love working from my home office, but it gets scary sometimes. Are your services something I need to subscribe to?

[qbteachmt]

"Are your services something I need to subscribe to?"

You are posting on a Peer Community Forum for the ProSeries program. As a professional, you would keep up with tax regulations, law changes, CE and other certifications and requirements.

Here, this is not Customer Support or Intuit Tech Support. Peer users are here, and volunteer to help each other; people who are struggling with how to use the program for something they thought they understood, or discussions on updates needed or problems found.

So, there is no Subscription. It's just like you meet a bunch of people down at the coffee shop.

[TaxGuyBill]

As was mentioned, we are just a bunch of volunteers/tax preparers here that help each other out on this forum.  I'm happy to be able to help others, so go ahead and keep this forum in mind.

At times we do have a weird sense of humor, but don't take offense at anything we say.  It is mostly in good fun and relieves the stress of tax season.