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@BarryHasMoved wrote: Turbo seems to be good with a way to split Interest and Dividends, but not so much for Capital Gains Distributions. Yeah, you're right. You may have to do an override on your MA return to accommodate the two distributions you received (one as a resident and the other not). That might involve printing and mailing the return instead of e-filing.

I think that's it.   Checking my records, for all the K-1s I have received, the income has always been listed under nonpassive income and the amount appears in both box 1 and 14. Almost all of them are at a small loss so self employment taxes didn't come into play. My earned income only decreased to this small amount for the past two years as I was paid on a fellowship, so it didn't matter before.   In this case, the software still thinks I qualify for the credit as initially calculated because now the $5,000 dependent care benefit is all taxable income and feeds into the earned income calculation. Is the software correct in doing so? Or as you said, my earned income should never include the $5,000 whether or not it's taxable?   On a separate note, is active/passive member designation based on actual participation and can be changed easily? I ask because I am technically a member-manager of the llc but have very limited participation.   Thank you so much again for walking me through this.

Did you get a 1099R or a SSA-1099 from Social Security?   For Social Security you have to answer Did you live in a Foreign Country screen.   Should be NO.   Or you won’t get any taxable amount on 1040 line 6b.    Have you already filed?

Yes, I took the standard deduction in 2023 but am still getting the error in my state taxes in the Final Review. In the state worksheet I have:   State/Local Code: NY Refund Tax Year: 2023 Refund Amount Received: $400 Taxable Amount (if different): $0 Total Payments and Withholding: $2405   The only field I can edit in the NY worksheet is the Total Payments and Withholding. I went back to the Federal > Income > Refunds from state and local tax returns section and tried different amounts but it still doesn't work. How can I fix this? Thanks for your continued assistance!

Thanks for the detailed answer.  Unfortunately it's part of my Capital Gains Distributions I'm looking to exclude.  Turbo seems to be good with a way to split Interest and Dividends, but not so much for Capital Gains Distributions. - Barry

Hello,   Illinois does not tax distributions from inherited IRAs.  Since my AGI from my federal is my starting point for the state, and the distribution is included, how do I go about removing it from my Illinois state return?  Turbo Tax does not offer guidance on how to do so.    

Ok, yes. Good. That is what I thought we were originally saying but I guess I read too much into the comment. So then my prior comment applies and I have enough 2025 expenses to cover the extra money (the $1K). So basically I declare the Return of Excess into Turbo Tax and then I do nothing with the extra $1K other than line up my receipts/Explanation of Benefits forms from BCBS that show the > $1K out of pocket costs? -Ben

Thanks.  Right, I'm not looking to dive into the sales the fund made.  The problem is they made two distributions in 2025... one was before I moved and the other was after.  Turbo only seems to give the option to mark the whole 1099 MA or Non-MA, but I need to exclude the Non-MA part. - Barry

Q. Do I put "yes" for support myself if I am a full time student that works part time for extras at school (food/housing) but am still considered a dependent for my parents? A. No.  The fact that you are a dependent means that you do not earn enough to be considered as providing more than half your own support. 

1. Yes, if you have an amount for either basis or proceeds, report the 1099-B. 2. Short term is held less than one year. Otherwise, long term. 3. I assume you purchased an ETF and acquired these fractions from that purchase. If so, purchase would be the correct option. There aren't many choices.

If I removed the k-1 entry, what forms would this be noticeable on for me to do a test run on it? Also, I don't think I can remove the k-1 entry, because I have carryover from previous years that autopopulates.

No, I am talking only about documenting medical expenses for the "$1,000".    The IRS allows you to withdraw excess contributions before the original due date (and extension). So the $3,000 (if that was the actual excess) is OK - you can do anything you want with it since that excess should have been added back to income if it was part of the code W amount on your W-2.   The issue is what to do with the $1,000 difference - the amount that you withdrew in excess of your excess, as it were. Clear?

Q. Are  there are some taxes I owe based on the information on the 1098-T? A. Yes, because "Box 5 is a little over double the amount in Box 1".   Scholarships that pay for qualified educational expenses (QEE - tuition, fees, books and other course materials) is tax free.  Scholarship amounts that exceed QEE is taxable income, on the student’s tax return. If box 5 of the 1098-T exceeds box 1, TurboTax (TT) will treat the difference as taxable income, unless you enter additional QEE at books and other expenses. Room & board are not QEE.   Q. When it explicitly asks if I "received tax-free education assistance from an employer, GI Bill, or veterans’ program" after I input the 1098-T information, I'm not supposed to put the housing/book benefits I received from the VA? A. Correct.  That is correct, although it's academic in your case.  Only GI benefits that are specifically designated for tuition are to be entered in that place. The intent is to reduce the amount of tuition eligible for the tuition credit.  But, you are ineligible for the credit because box 5 is more than box 1.