Could you confirm if Turbo tax online premier software does not support 2024 California law disallowing deduction for Intangible Drilling Costs (IDSC)?

[kashyapvijay]

My 2024 California tax return is not adding Intangible Drilling Costs as taxable amount reported on schedule K-1. Even the amended tax return has same issue, in spite of help from the turbo tax support representative. Could you confirm if Turbo tax online premier software does not support 2024 California law disallowing deduction for Intangible Drilling Costs (IDSC)? If yes, what is the solution?

[RobertB4444]

TurboTax Premier does not cover the IDSC at the current time.  You would have to manually enter the income into the California forms and then mail in the return.

@kashyapvijay 

[kashyapvijay]

It is surprising that Turbo tax premier did not implement IDC for California and its support staff was not told about it. The turbo tax support staff were insisting that generated California return is handling IDC correctly and 2024 amended California return was generated and filed with their support even though there was no difference in tax amount before and after amendment. My only reason to use Turbo tax premier for 2024 tax was IDC situation for California. It is very disappointing that not only Turbo tax not support IDC for California but did not disclose this fact to its clients/users.

[DawnC]

You can enter an adjustment on the CA return to negate any IDC entry on your federal return.   See Expert -PatriciaV's instructions, linked there and shown below:

To eliminate intangible drilling costs reported on Schedule K-1, you will need to manually adjust Line 13d under the California K-1 adjustments topic.  Find this from the page "Here's the income that California handles differently" under Business >> Partnership K-1.

The Federal column displays the full amount you deducted on your federal return. Enter zero in the California column for Line 13d and on Line 17f.

If IDC is reported to you in the future, you will need to make this adjustment each year.

[kashyapvijay]

These instructions also do not generate correct returns for 2024 California. I had discussion with Patricia V on a separate thread on this community form and her final suggestion was to add IDC in the ordinary income for 2024 California tax return and add a note that this is to account for IDC since the Turbo Tax software is not handling IDC correctly for 2024 California tax calculation.