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After entering the 1098-T, you will reach a screen that will  asked if any of the scholarship was used for room and board (R&B), answer yes. Then enter the amount you want to be taxable (usually the difference between boxes 1 and 5), in the pop up box. R&B are not "qualified educational expenses" for tax free scholarship.  So, this is how you tell TT that it is taxable. Note the wording at that screen “or other expenses”. You didn’t have to literally use the scholarship for R&B.  This will put it on line 8r of Schedule 1.   Scholarships are a hybrid between earned and unearned income. It is earned income for purposes of the $15,750 filing requirement (2025) and the dependent standard deduction calculation (earned income + $450).  It is not earned income for the kiddie tax and other purposes (e.g. EIC).  For grad students and post grad fellows, scholarship, stipend and fellowship income is earned income ("compensation") for IRA contributions.

This forum has no access to your return so what you provided gives us no clue as to why TurboTax says there's an excess. To contribute $8500 for 2025 you must have been covered every month by a Family HDHP,     Did you use the Last-Month Rule in 2024? If not, delete any entries you made for 2024. If you were covered by Medicare or a general non-HDHP you would be ineligible for part of 2025      

Depreciation for Schedule E was updated this week and is now ready to use; I was able to move past the error screen after updating my desktop software today.    If you've run the updates (including those for TurboTax Business) - or you've logged out and then logged back in to TurboTax Online - and you're still unable to move forward with entering your depreciable rental assets for the year, then follow the below troubleshooting steps for your software platform--   First, begin troubleshooting by logging out of the TurboTax platform you're using, Online or Desktop. From there, try these options:  If you are using TurboTax Online Check ‌your browser's settings - Clear your Cache and Cookies Here are the official instructions for the most popular browsers: Google Chrome Mozilla Firefox Microsoft Edge  Log back into TurboTax Online and select Pick up where you left off to return.   Or, try using a different web browser to login and complete your entries - i.e. try logging in on Mozilla Firefox if you are using Google Chrome; or try using Chrome if you are using Microsoft Edge.  If you are using the phone/tablet app, try changing to laptop/computer if possible. If you do not have access to a computer, switch to a web browser within your phone or tablet, and sign in from there. If you are using TurboTax Desktop Make sure the software is updated.  If you haven't rebooted your computer, please do. Check your firewall and antivirus settings. Make sure they aren't blocking any feature of the software. 

To prevent the exception smart worksheet and completion of Line 1b, ensure that there are no adjustments or a "various" date.   Note that the IRS allows you to skip Form 8949 only if there are only Category A (Short-Term) or D (Long-Term), no adjustments and the basis was reported to the IRS.   In the Desktop version, you can fix this manually on the worksheets that flow into the Schedule D.   Go to Forms at the top right and then find Capital Asset Sales Worksheet, or the 1099-B Worksheet for the specific broker Ensure that the box, "Check here if this summarizes multiple sales" is checked Ensure the sales categories are either Box A or Box D Go to Sch D (located above the worksheets) and you should see the totals are up in Line 1a   If you are not using the Desktop version, you should consider deleting the existing Form 1099-B and then start over, ensuring that when inputting totals for Box A and Box D, they do not include any adjustments or wash sales.   If you leave the adjustment field with $0.00 instead of blank, or select a different category than A or D, TurboTax will automatically generate Form 8949 and move your totals to Line 1b.   To delete Form 8949 in TurboTax Desktop, select it from the left and then click "Delete Form" at the bottom of the screen.   To delete Form 8949 in TurboTax Online, go to Tools, Tax Tools, then Select Delete a form from the pop-up window.

You betcha.  This bug has been around for several year and is still present in the 2025 TurboTax Business software.  This becomes very annoying when overriding and correcting shows up as exceptions when you run the final review.  Turbo Tax, are you listening??  Why don't you fix it?

@user17599659476    Are you preparing taxes for the client...but this is the Consumer software tax area.  I have no idea how the Pro/Lacerte software handles it.  You might need to find the Pro/Lacerte Forum area to ask about it there.   But it may be similar to the Consumer software, where you designate it as being Bailey Settlement eligible in a follow-up question. ______________________ In the Consumer software..... A page or two after the main form they can select a bullet point indicating it is eligible as a Bailey Settlement retirement distribution.  The main form (in the software) must a least have "NC" entered for the state in box 15 of that CSA-1099-R form.  They must keep the CSA-1099-R form in their possession, and perhaps some record of their employment with the  US govt in case NC ever asks.    

Entering tip income in box 7 and overtime income in box 14 with a category of Overtime on the W-2 will have the TurboTax program complete Schedule 1-A Part II for No Tax on Tips and Part III No Tax on Overtime.  The result is on Schedule 1-A Line 38 which flows to the Form 1040 Line 13b.   If you do not see this on your TurboTax desktop program then make sure that you are at the latest release.  Click on Online at the top of the desktop program screen and then click on Check for Updates   You can see the calculations on Schedule 1-A by clicking on Forms

@Joan2 , are you saying that you had "nil" interest expense on 4952  ( then why did you need one /  or is it because of disallowed  interest expense ? ) and zero entry created an issue with  form 1116 ?      Are you using the most recent update version of desktop version ?  or are you using  on-line version ?