When is it advisable to recalculate my 2016 return as part of doing my 2017 taxes, when I DID pay alt min tax in 2016?

[scott-grasse]

I started my 2017 filing by importing my 2016 filing results.  When I did this, the amount of my 2017 state refund that I received in 2018 was already known.  Do I still need to "recalculate" 2017 taxes?

[bhupp]

+1 TT should do this calculation for you. They have all of the information and that is why I buy software so it will do exactly this kind of thing.

[asdfg1234]

Already filed 2017 taxes and I did have AMT and did have large state refund. Can TurboTax team be forthcoming and come up with automated calculation tool so that those of us who want could still easily amend via 1040X? Wondering if this potential extra refund is larger than hiring professional CPA...

If it is, then perhaps TurboTax should recommend its customers not to file via TurboTax, but rather recommend to hire a professional CPA?

[sd5]

So rediculars! I paid 100 bucks for doing this by hand myself?!

[dcrane123]

+1 TT should do this calculation for us. This comment board alone demonstrates dozens of customers speaking up, and many more no doubt don't get here or give up in silence. We didn’t buy the software for instructions on how to maximize our tax savings, but for algorithms that will do the calculations for us. This is complex stuff (dare I say, non-Intuitive?). See detailed article in professional "CPA Journal" at <a rel="nofollow" target="_blank" href="https://www.cpajournal.com/2017/10/13/unlocking-benefits-tax-benefit-rule/">https://www.cpajournal.c...> .

[jko]

The amount of time manually calculating something that should be an included feature is incredibly frustrating. I finally figured out the recalculation amounts, and I am now stuck on the “tax benefit calculations.” The amount of time to calculate manually makes me wonder the value of paying for TurboTax premier.

Intuit, look at the volume of customers wanting this feature. Many more are not posting here. This feature shouldn’t be too difficult to add especially if we are returning customers from last year.

[james12]

Yes. Please do this calculation for us. Isn't that the whole point of TT?

[harvardholmes]

The "Computation of Recovery Exclusion" worksheet is confusing because you are calculating a 2018 return number, but the inputs for that number all come from your 2017 return.  TT has difficulty with that because, in general, when you are working on your 2018 return, TT does not have access to your 2017 return, including all the formulas and parameters that applied in 2017.  So the trick is to PLAN AHEAD and figure out what that 2018 number will be, while you are working on your 2017 return.  TT DOES facilitate the calculation of this 2018 number, while you are working on your 2017 taxes.  That is what the "Computation of Recovery Exclusion" worksheet does.  In my comments from a year ago, I found that this worksheet was hard to find, at least for me, but the comments tell where to find it, and it DOES THE JOB that everyone is complaining about.  I agree that TT could make this situation more obvious by alerting anyone who paid State taxes and also paid AMT, that they should use this form for their next years taxes.  If you used the desktop version of TT last year, you might be able to start up last year's version and go back in and calculate the number you need this year.  I don't know if TT makes previous versions of their on-line software available in this way -- it seems like it would be a nightmare for them to keep track of all those versions and data...  I have gotten several comments on this from this discussion thread, so I thought I would give my take on it.  I have not started my taxes this year, so I am just ASSUMING that the "Computation of Recovery Exclusion" worksheet is still available for this year.  If not, why not?

[scott-grasse]

I have used TT for years so it does have access to my previous years records.  There is no reason TT shouldn't be able to do this.  Even thought there is a way this can be done, it is still horribly non-intuitive and yields zero confidence that it has been done correctly.  I had to pay a professional to do it for me last year and even they admitted it was incredibly complicated and tricky.  

[LaJolla]

I have been using TT for years, and I have almost always done Sch A and been subject to AMT for at least the last few years.
I have done the AMT recalculations in the past and TT always comes back and states that 100% of this is taxable in the current tax year.
In 2017 I paid 17,449 in AMT, but I also got a large refund from the Fed and CA simply because I had overpaid my estimated taxes because I began doing work as an independent contractor and part of my earning, I deferred into a 401k so that amount was not taxable in 2017. Anyway, I ended up with state refund of 6696 for 2017 for which I just got a 2018 1099-G.
However, unexpectedly I also got another 2018 1099-G for 31, which was for tax year 2016 because I had to do a 1040X for tax year 2016 after I got my 5th corrected 1099-Div from my broker (small refund 31). Unfortunately, I erroneously already included this refund on my 2017 taxes because I got this second CA refund check last March (2017) prior to doing my taxes so I simply added the 31 to my other state refund for 1043 which I did get a 1099-G which applied to tax year 2016. {I erroneously assumed that since both refunds applied to tax year 2016, I needed to include both refunds on my 2017 taxes even though the first refund of 1043 I got in 2017 and the second refund for 31 I got in 2018; I now Know that I should not have done that}
Anyway, when I was doing the AMT recalculation for my 2018 taxes, TT wanted me to enter the 6696 into the Tax Payment worksheet of my 2017 TT program as usual to recalculate the AMT amount; however,  after I enter the revised amounts from my 2017-1040 (line 44 and line 45 which the former was higher and the latter lower), TT then asked me about refunds PRIOR to 2017.
TT had already automatically entered the 31 refund I got in 2018 for tax year 2016.
But then  TT asked how much of this was taxable, since I did fill out SchA I assume all of it is taxable so I included the full amount. Then TT asked me to include any other state refund I received for 2016. However, it’s unclear TT is asking me to include any other state refund I got in in 2018 for tax year 2016, of if they want me to include the 1043 state refund I got in 2017 for tax year 2016.
Can you please help?

[emersonxsu]

Seems like a not difficult solution for TT to recalculate the taxable in this case and many users like me are having the same headache. TT is great but should they make some team to work on this feature?

[E-J-]

I recalculated manually and found that my state tax refund was not taxable. I'm so glad I tried. It was certainly tedious because you need to go back and forth with various forms/instructions/worksheets, but if you follow the instructions patiently step by step, it is definitely doable. I printed extra copies of my 2017 forms and started making corrections on them. Each time another form or instructions are mentioned, I just printed out the relevant pages. I had all these forms and worksheets spread on my desk and finally got the few numbers TT needed. It took me about less than an hour to finish. Don't be discouraged by the wording of TT, and I highly recommend you give it a try!

[ottinok]

Does anyone know if Turbo Tax Live Premier will calculate this? I tried on my own but am not confident in my answers. I have always gotten a state tax refund and always paid AMT because I live in a high tax state/city (NY) and most people I talk to are the same so I disagree that "most customers who pay AMT don't have state refunds."

[NH1]

I just refigured my 2017 taxes, and it resulted in my 2017 state refund not being taxable in 2018, saving me about $2300.  Took me about 1.5 hours.  I can understand why TT won't do this for you.  There are lots of possible variables, and I think TT would have to redo your entire previous year's taxes to be sure its calculations are correct.

[scott-grasse]

Since I file with TT every year there is absolutely no reason why TT could not recalculate my previous year for me.  iI has all the information!