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Deductions & credits
Maybe. Maybe not. this is due to the fact that the deduction for taxes is capped at $10,000 and also situations where you are paying alternative minimum tax. Turbotax calculates the taxable amount if any. if some or all of it is taxable it is treated as income not an offset to itemized deductions thus increasing your adjusted gross income and many items in the tax return are affected by AGI.
if you want the calculation see the 1040 instructions page 84 but if any of the situations enumerated apply then you need to use Pub 525 page 23. the taxable portion, if any, shows up on schedule 1 line 1
‎September 7, 2022
1:32 AM