Deductions & credits

Since I couldn't use the Step-by-Step entry method, I went to the forms to enter this information. Working backwards from Schedule A, I found what I think is the right place to enter this state tax amount, which in Washington is a 7% tax on the long term capital gains from the sale of stocks, bonds or other similar assets (home sale gains are explicitly excluded).

 

I entered the amount on the "Tax Payments" worksheet, line 24 "Other (amended returns, installment payments, etc.)" under the "Prior Year Taxes Paid In 2024" section. I put the value in the State column and WA in the ID column. I also added a supporting details note describing the tax and the date I paid it.

 

The value appeared to flow correctly into the appropriate forms: "Schedule A Line 5 State and Local Tax Deduction Worksheet", Tax & Int Wks (titled "Schedule A Lines 5-12 Tax and Interest Deduction Worksheet"), and Schedule A, line 5a.

 

Sadly, even though this was a sizeable amount, other state and local taxes added to it exceeded the $10,000 limit for the deduction, so this was all moot (e.g., the home property tax exceeded the limit all by itself). Nonetheless, it would be good for Intuit to update the Step-by-Step entry forms to support this new Washington state tax, which is based on income from capital gains, even though the state does not have a formal income tax like many other states.

 

Finally, I would appreciate an expert in this forum community to comment and hopefully confirm my entry method.

 

Thanks very much!