Turbotax Live used the wrong AGI

[Tolkach]

I just completed my return. Everything went fine, except that Turbotax live used my 2019 AGI instead of my 2020 AGI. I would like to amend that return, but first I would like to know why this happened, because I don't want it to happen again. I made a lot less money this year, and I don't want to be taxed on last year's wages.

-Dave

[mesquitebean]

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@ Tolkach   wrote:

I just completed my return. Everything went fine, except that Turbotax live used my 2019 AGI instead of my 2020 AGI. I would like to amend that return, but first I would like to know why this happened, because I don't want it to happen again. I made a lot less money this year, and I don't want to be taxed on last year's wages.

You said "amend", so did you already efile your 2020 return and if so, has it been accepted?    Or is it still in preparation and unfiled?   You used the term "just completed", but didn't say it if has been efiled or not.

I don't understand what you are experiencing.  There must be more to the story.   Where was a "2019 AGI" used instead of a "2020 AGI?"   When efiling a 2020 return, one uses the 2019 AGI to verify the return for efiling.   Or are you referring to an AGI in some other context?   Or are you using the term "AGI" incorrectly? In other words, I don't know what you mean. So far I don't understand your question without more context.

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EDIT NOTE:  4:58 PM Pacific

See the comments by@ VolvoGirl and @ SweetieJean  below which follow my answer.   Maybe they are inferring what you are talking about in your posting.  Are you referring to the Earned Income Credit and ACTC?  Again, you can phone Support and consult a Live tax expert you have paid for.

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[VolvoGirl]

You can use the 2019 AGI to figure the EIC earned income credit this year if it is more than 2020.  

The special lookback rule will allow lower income individuals to use their earned income from 2019 to determine their Earned Income Tax Credit and the refundable portion of the Child Tax Credit in 2020, since their lower 2020 income could reduce the amount they are eligible for.

[SweetieJean]

Turbotax live used my 2019 AGI instead of my 2020 AGI.  I don't want to be taxed on last year's wages.

Are you referring to using 2019 earned income instead of 2020 for EIC and ACTC?  Earned income is not the same as AGI, or as Wages.  

The Earned Income Credit for 2020 is computed by comparing two amounts in the IRS's EIC table -- an amount based on earned income – which can be from either 2019 or 2020 -- and an amount based on your 2020 AGI (which includes things like unemployment comp).   Whichever of these two amounts from the table yields the smaller EIC amount will be used.

Your 2019 AGI is not considered here.  If your 2020 AGI is too high, it doesn’t matter which year you use for earned income.   Please see Worksheet A -- 2020 EIC -- Line 27 in 2020 Instructions for Forms 1040 and 1040-SR to see how the computation works.  And then please discuss with your TT Live Expert.

[SweetieJean]

@VolvoGirl  Actually, 2019 AGI never comes into play here, just 2019 v. 2020 earned income.  It's one of those those quirks in the new tax law.

[Tolkach]

Wow, quick responses on this. Thanks!.  

The EIC is a non-issue. The 2019 AGI was used for all the means tests, which doesn't make sense. Worse yet, the 2019 AGI transferred over to my Ohio state return. The amount used for my 2020 Federal return AGI is exactly what it was for my 2019  Federal return, but the income entered into Turbotax Live for my 2020 return is $40K less.  It looks like a bug to me.