Rounding to 3 decimal places can cause a substantial difference in the reported income. For example, a $100,000 distribution can have up to + or - $50 difference. The IRS allows higher levels of precision, and I guess seems that they set the minimum the 3 to allow easier calculations. This looks like a throwback to the days before calculators and computers. In fact, the way computers handle fixed point multiplication, programmers have to go out of their way to round off at 3 decimal places. I had to add a few steps in my cross checking spreadsheet. Seems archaic to me. BTW, TaxCut does the same thing as TurboTax (e.g. 3 decimal places).
