Trying to find info from 2021 taxes to respond to IRS letter.

[GESM11]

Just received notice from IRS of incorrect info in my 2021 taxes with a large amount owed. I have pdf of all forms and backup info, and am able to open that return in TurboTax (on my computer hard drive). But in neither case can I find the Form in question (8949) which the system help says is built from other information entered.  But going back into Turbo Tax, I cannot find where individual transaction data from the Form 1099-B from my broker would have been entered.  [It was not imported.]  Since it was 2.5 years ago, I can't recall entering all the details manually, but I feel certain I would have used aggregated data, not individual transactions.  But the IRS letter is showing individual transaction dates.  I want to see what I entered (and preferably any prompts in the software for entering that information) in order to see whether the mistake is mine, and how it happened (especially since I might have made the same mistake for 2022 and would need to do an amended return).  Can anyone tell me how to figure out how the detailed data got entered and communicated to the IRS (presumably on form 8949) and most importantly, how I can see it?  Thank you.

[fanfare]

TurboTax made some changes to handling of Form 8949, namely suppressing the form for Box A or Box D transactions in some cases.

It does this without warning.

Compare your consolidated 1099-B with your filed Schedule D Lines 1,2,3 and 8,9,10.

The subtotals by Box Category should match.

@GESM11 

[GESM11]

@fanfare, Thanks for the quick response.  Unfortunately, Turbo Tax determined Schedule D wasn't required in my case and checked the appropriate box on the return.  I checked my 2022 taxes and the same is true, so I don't have a Schedule D to compare with my 1099-B from the broker.  

I've thought of going through entry of the whole capital gains section again just to see what it asks me, but I don't want to change or overwrite the file from what was originally filed.  I guess I could just start a new 2021 for a dummy person and just go to that section.  But since it says you can enter aggregate or individual transaction data, that still wouldn't allow me to see what I did before.

This seems to be a major flaw in how Turbo Tax does things -- a user needs to be able to get back to their entries and follow the trail they originally followed in case of an IRS query or error notice.  This is definitely giving me pause about continuing to do my own taxes, although they really aren't that complex and I've  enjoyed using Turbo Tax over the past 15 years or so.  But I have no way to determine whether the IRS is correct (and whether I made the same mistake in 2022).  

I would appreciate any ideas on how I can see the data under the covers.  It's my data and I entered it, so it should be able to give it back to me.

[fanfare]

Always make a paper copy of what you filed for your records.

You will need it if you are audited by IRS, or to amend.

If schedule D was not included then you did not import your 1099-B successfully, if at all.

If you had sell transactions in 2021, Schedule D is required, so IRS is correct in that respect.

You'd have to file an amended return.

If your amended return, with Schedule D, matches the additional tax shown in IRS letter,

you could just accept the IRS finding.

You have the same problem with your 2022 return, you will have to amend it.

@GESM11 

P.S. Many have complained that the box was checked and got an IRS letter.

You may have a claim under the TurboTax accuracy guarantee.

Good luck with that one.

[fanfare]

What is the amount in your 1040 Line 7  ?

Does it include the Grand Total  (proceeds minus cost) of all box categories on 1099-B?

@GESM11 

[GESM11]

@fanfare, thanks again for the quick response.  I remember thinking it was odd that there wasn't a Schedule D -- seems like an error in Turbo Tax.  I didn't import the info from my broker because they aren't one Turbo tax is set up to automatically import.  I typed in the data, just not certain whether I did aggregates or individual transactions (based on IRS data, I suspect I entered individual data).

The IRS isn't complaining about the lack of Schedule D, but rather that the cost basis was entered as both the cost basis and the proceeds for every single transaction (although how I have any capital gains at all in that instance is curious).  I just started a dummy return and entered the details from a few transactions from my brokerage statement. I do not see how I could have made that mistake on all lines -- would be hard enough on a single line. Such a mistake would certainly be possible a time or two, but not on the ~36 lines of transactions (assuming I entered them individually, not in aggregate). 

Based on your comments I am really starting to think this was a Turbo Tax mistake, but I agree with your assessment of the challenge in pursuing that path.  But if, as it appears, that the information was calculated based off the incorrect data (however that came to be), I do owe the IRS a fairly significant sum.  And I probably need to recalculate for 2022 as well.  

Thanks for your help.

[GESM11]

@fanfare.  Things are definitely messed up.  1040 Line 7 is $8740.  Total across all categories in the 1099-B is approximately 3 times that amount (nearly all long-term).  Really makes no sense that TurboTax decided a Schedule D wasn't required.  My mistake for trusting it.   For 2020 and earlier, Turbo Tax created both a Schedule D and a Form 8949.  But not for 2021 or 2022.

Thanks for pointing me at the things to check.  I will respond to IRS (and prepare to send them a big check) and pursue an accuracy guarantee claim with TurboTax. [not planning to hold my breath]  Appreciate your help.

[fanfare]

Before paying you have to calculate the actual capital gains tax using correct amounts.

Sometimes IRS uses a basis of zero which results in a huge tax.

@GESM11