This is a bona fide bug in the software. It hit me, too, as I was finalizing my taxes on October 15th - a date by which you think they'd have issued fixes for all the bugs in this year's program. I called Intuit's TurboTax support number. and the rep who answered was useless; he couldn't even understand what the problem was and seemed completely unfamiliar with both tax preparation and the software.
In any case, you are 100% right: When you enter a payment made with an extension under Personal/Deductions & Credits/Estimates and Other Taxes Paid/Other Income Taxes, it doesn't show up in the right hand column of the Deductions & Credits screen and doesn't propagate through to your 1040. The program therefore "thinks" you owe money you don't. I am a computer programmer who has done quality assurance, so I dug in and finally discovered a workaround. Here is how to do it in TurboTax for Tax Year 2020. If you select "View/Forms" from the menu bar, and click the folder icon that says "Open Form" near the left side of the screen, you'll get a dialogue box that lets you search for a form. Type "Tax Payment Worksheet" in there. Select that form and click the "Open" button at the bottom of the dialogue box. You can then enter the amount you paid with your Federal extension on Line 9 in the "Federal" column. BOOM.... You'll see the program recompute in real time and the result will be what it's supposed to be.
What is incredibly disappointing is that Intuit's tech support couldn't tell me how to perform this workaround... and wasn't even willing to believe that this was a real bug in their code. I think we both deserve rewards because the problem clearly violates their accuracy guarantee. In the meantime, Intuit, please at least fix this bug for next year!
