When generating an Other State Tax Credit (OSTC) for a part-year resident return in Lacerte, keep in mind:
- Lacerte doesn't automatically calculate the OSTC when a taxpayer was a part-year resident of two states and needs to claim the OSTC for one of the states.
- Lacerte won't calculate the OSTC when the other state isn't included in the client file.
How to generate the OSTC for a part-year resident:
- Go to Screen 52, Other State Tax Credit.
- Select the applicable state from the OSTC panel.
- This should be the state that's claiming the credit. Generally, the resident state at the time the income was earned.
- Select the State abbreviation from the dropdown menu.
- Enter the applicable information required for the state. For example, the adjusted gross income (AGI) or taxable income, or income tax paid.
- Input will vary by states.
Once you've entered all the information, go to the state form and make sure that the program is calculating the OSTC properly.
If the credit is incorrect, check Diagnostics to see if the state requires other information. (Some forms may be suppressed when using overrides.)
If you need more help, see Other State Tax Credit for a Full Year Resident for more information on the automatic calculation.