IRS Notification of error related to Refundable Child Tax Credit, it's about SCHEDULE 8812

[speedtrack23]

 I received a notification from IRS today, saying I owe $3,324 due to an error in my 2021 Form 1040 about Refundable child tax credit.

I am filing MFJ w/ two children under 3 years old. Our total income for 2021 was between $150,000 and $400,000. However, in 2020 it was lower than 150K and we qualified for the Economic Impact Payment.

Here are those possible reasons listed in the letter:

1. The computation of the credit on Schedule 8812 was incorrect.

2. The amount on Schedule 8812 was not transferred correctly to your tax return.

-This means I figured the correct amount on Form 8812, but transferred it to Form 1040 incorrectly.  I find that unlikely when I am using Turbo Tax. 

3. You received advance child credit payments but did not reconcile them or reconciled them incorrectly.

-We only received The Economic Impact Payment which is not an advance Child Tax Credit payment. Since I did not receive any advance Child Tax Credit payments, I entered zero for that but tried to log in to verify and got an IRS server error.

Will someone @turbo Tax help me? Please!

[Mike9241]

Turbotax can't help because they have no authority to check with the IRS. this is the weekend so the IRS servers may be down for maintenance, try again on Monday.

for further help

The Audit Defense service is provided by TaxResources, Inc., also called TaxAudit.com, in partnership with TurboTax. If you paid for Audit Defense and you received an IRS notice, call TaxResources, Inc. at 877-829-9695, or report your IRS notice on their website at http://intuit.taxaudit.com/. Do not contact the IRS until you have spoken to TaxResources. They may contact the IRS on your behalf.

[speedtrack23]

Was looking for Turbotax help because I did my taxes through it and to verify "

computation of the credit on Schedule 8812 was incorrect". I didn't purchase the Audit Defense service. Is that something that can be purchased after?

Just looking for any advice before trying to call IRS to find out what is going on.

[fanfare]

@speedtrack23 

If you did not receive any advance child tax credits, then you would not be asked to pay anything back because of your 2021 income.

If you did not receive any advance child tax credits, but Form 8812 says you should get some or all of the missing credit as a refund. IRS will check your form 8812 for correctness.

The amount you filed for is on 1040 Line 28.

If you filed for EIP3 incorrectly ( a common problem with TurboTax) you would have an amount on 1040 line 30.

IRS will take that off or reduce it also if your income is too high, or they already sent out EIP3 to you.

[speedtrack23]

I did get a Tax Child Credit for 2021 for $1,800. I see that the child tax credit is reduced to $2,000 per child from $3,600 if your MAGI in 2021 exceeds $150,000 MFJ. Why am I paying more? The only way I am seeing it is if I do (3,600*2-$2,000*2)= 3,200..then IRS wants interest. Thoughts? I didn't file EIP3.

[fanfare]

based on 2000 per child you should have on Line 28

$2,000*2-$1,800 = 2,200
so IRS owes you money.
What did you file on Line 28?

BUT, looking at the credit worksheets, it's super complicated so it all depends on your tax situation.

Does TurboTax have bugs? I would not be surprised.

There are other tax prep outfits on the internet that will do your 2021 tax return (federal) for no charge.

I'd try again there.

Last year I went through four tax prep softwares and every one gave a different, and wrong, answer for my total tax.

Finally one became correct late in the tax season. Hint: it was not TurboTax.

[speedtrack23]

I have nothing on line 28

I even updated B1 to show $1,800 and now it shows it in 14f. With 28a it should have $1,800 and in 28b It should have $4,150. Then 29 should have $2,350. What else I'm I missing?

[VolvoGirl]

No.  What's on line 28 on the 1040 tax return?

[speedtrack23]

[VolvoGirl]

@speedtrack23  First you said you only got the Stimulus payment and not the Advance Child Tax Credit .   Now you say you did get the $1,800.  That was the Advance Child Tax Credit.  Did you enter it into Turbo Tax?   If you have a high income you might have claimed too much.  

What do you mean you didn't file EIP3?   Is it showing on line 30?

[speedtrack23]

Correct, I did receive the $1,800 Advance Child Tax Credit. I didn't enter it into Turbo Tax. Do I need to amend anything? I didn't file EIP3 and nothing shows on line 30. 

[Cynthiad66]

In any event, IRS is the only entity that can answer your questions.  They will provide you a Notice of Explanation in a few weeks.  Just a FYI, if you received Advanced Child Tax Credits filing a joint return, the IRS sent out two letters saying how much each taxpayer received.  You would have to combine the amounts on each letter to come up with the total Advanced Child Tax credit received.

There is no need to file an amended return once the IRS has started to make adjustments.  You can call them, but it is just better to wait until the dust settles then contact them if you find their information is not correct.

TurboTax is a tax preparation platform that allows you to prepare your own return then submit to the taxing authorities.  TurboTax is not updated on the status of your returns once they have been accepted due to Privacy Laws.

@speedtrack23

[speedtrack23]

Do you mean they will expound more than?:

Here are those possible reasons listed in the letter:

1. The computation of the credit on Schedule 8812 was incorrect.

2. The amount on Schedule 8812 was not transferred correctly to yourself tax return.

3. You received advance child credit payments but did not reconcile them or reconciled them incorrectly.

[Cynthiad66]

Yes.  The letter that they will send out will provide details for the adjustment and also allow you to present evidence to support what you claimed.  It will take a few weeks to get the letter but you will get letter.

Your corrected refund will be issued but you can still receive the disputed amount plus interest if you are entitled.

Slow process but worth it.

@speedtrack23

[speedtrack23]

Nothing has come in the mail yet. Sounds like I just need to wait for that before trying to call the IRS? Anything else I should try/do?