Robert,
IRC 164(a)(1) specifically lists state and local real property taxes as deductable. Thus, Schedule A line 5 includes real property taxes. Also, IRS 2025 Instructions for Form 8960 reinforces that property taxes should be included in the NIIT deduction as it says "Include state, local, and foreign income taxes you paid for the tax year that are attributable to NII. Include also state, local, and foreign real property taxes paid for the tax year, as well as state and local personal property taxes paid that are attributable to NII." (See Instructions, p. 17).
If TurboTax is not including property taxes on the 8960 worksheet or in Line 9b, this appears to be wrong given the authority cited above.
How can this be resolved? Can TurboTax update the desktop software regarding this?
