Turbo Tax is not considering Virginia PTET Credit when calculating underpayment on form 760C

[maihde]

I have received a Virginia VK-1 that includes a PTET credit.  This PTET credit is accurately reflected on my VA760 line 25 and I am receiving a refund from Virginia.

The odd thing is that VA760 line 32 shows a penalty related to underpayment.  This appears to be due to the fact that Form 760C line 1 is not considering the PTET credit and using VA760 line 18.

The Virginia instructions for 760C line 1 are "Start with the tax liability reported on your income tax return.
Subtract the Spouse Tax Adjustment and tax credits and enter the result here."

It seems that Turbo Tax is neglecting including credits, specifically the new PTET credit, when determining if an underpayment has occurred in Virginia.  Overriding 760C line 1 will address the issue, but this seems like a defect/bug in Turbo Tax.

@PatriciaV based on other questions, you seem to be familiar with Virginia PTET, what are your thoughts?

[JCMA25]

I'm having the same issue.  My Vk-1 shows significant tax payments made but I'm getting a large late penalty on the 760C worksheet.  I'm suing TT Desktop Delux Windows.  What specifically do I need to do to fix this?  Forms mode?  Please help me.   @PatriciaV  

@maihde

[merge2022]

I am experiencing the same issue. How can we fix that?

[CatinaT1]

Are you still experiencing this problem?

Make sure you have ran all updates. Please see this FAQ.

If you still are not able to solve this, please call TurboTax Customer service.  Here is a link:  Turbo Tax Customer Service 

[dlafuria]

I'm having the same problem.  Underpayment penalty, but my firm paid PTET timely to Virginia.  Is there a solution coming in an update?

[CatinaT1]

Are you still experiencing this problem?

Make sure you have ran all updates. 

If using TurboTax Online: Clear your cache and cookies. See this FAQ, for your particular browser.

If using TurboTax Desktop: Please see this FAQ.

If you still are not able to solve this, please call TurboTax Customer service.  Here is a link:  Turbo Tax Customer Service 

[Taxguy100]

Latest update as of 4/7/24, the problem is still there. Workaround: simply check the box in the upper left of form 760C that says to let VA Dept of Taxation calculate the penalty. The form is then overridden and no penalty is shown. I had called TT support and they couldn't otherwise fix it, and asked me if I knew a workaround. 

[youdontneedmyname]

@Taxguy100  How can I edit form 760C? The only option I can find is to delete the form, but that doesn't correct this issue. Thanks.

[Taxguy100]

The form pulls data from other places so I don't see a way to edit the form itself. In the upper left, you can click the box that reads: "Check this box if you want the Virginia Dept of Taxation to figure the addition to the tax." This then sets all value to zero, and prevents any penalty from being added to the tax. Maybe VA's calculation will be different, you never know. 

[youdontneedmyname]

Thanks for your help @Taxguy100 . I'm still having trouble finding the box "Check this box if you want the Virginia Dept of Taxation to figure the addition to the tax." I've looked on the Virginia returns page, the underpayment penalty page, the review page, the PTET page -- where can I find this box to check it?

[Taxguy100]

I use the desktop version. If you using the online version, then you probably need to call TT tech support and ask. 

[youdontneedmyname]

Spent more than 2 hours on the phone with TT support and they were unable to help. They suggested paying for the live tax support and that would help.

Those of you who've been able to do this on desktop -- which software version do you have? Is it home and business? Thanks.

[PatriciaV]

If you have an underpayment penalty on your Virginia State tax return, you can access Form 760C using Forms Mode in any version of TurboTax for Desktop.

1. Open your return and click the Forms icon in the TurboTax header. 
2. In the list of Forms in My Return on the left, scroll down to Virginia Individual and look for Form 760C. 
3. Click the form name to open it in the large window. 
4. Check the box under the form title to allow the VA Dept of Taxation to figure your tax.
5. Click Step-by-Step in the header to return to the main screens.

@youdontneedmyname