I have some subtractions from income on my 2023 return and TT is not producing a MD state form 502SU. I checked my 2022 return for comparison and there is a Form 502SU. Am I doing something incorrectly or Is there a fix for this?
Please clarify what subtractions should be on your Form 502SU?
@RachelW33Capital gains from sale or exchange of U.S. Government obligations
As noted in the Form 502 Instructions on Page 8, if you only have one of the subtractions, then Form 502SU is not needed. In that case, the subtraction would just be entered on Line 13 of Form 502 with the appropriate Code letter.
If this is not the case for you and you have other subtractions in addition to the sale or exchange of U.S. Government obligations, please respond back so that I can look into it further.
@RachelW33I also had interest and dividends from U.S. obligations
Interest and dividends from U.S. Obligations and capital gains from the sale or exchange of U.S. Government obligations both use Code ab for the subtraction.
On your MD Form 502 Line 13, you should see the total of them subtracted with Code ab notated to the left.
@RachelW33where in TT step by step instructions do i enter both numbers? Wonder if I missed a step in TT?
If you have a Form 1099-INT that reports interest in Box 3, the amount will automatically be included in the MD Form 502 Code ab subtraction.
If you have a Form 1099-DIV that includes U.S. Government Interest, after you enter it, you need to check the box that "a portion of these dividends are U.S. Government interest". Next, click continue and enter the amount.
Next, when walking through the preparation of your Maryland return, you will come to the screen Capital Gains from U.S. Government obligations are Tax Free. Here you will enter the amount.
Finally, on your MD Form 502 Line 13, you should see the total of your Interest and dividends from U.S. Obligations and capital gains from the sale or exchange of U.S. Government obligations subtracted with Code ab notated to the left.
Hi,
I went through all the steps of the Maryland return, but did not come across this page listed below. How to get to it and enter the capital gains amount form us gov obligations? Is this under income or deduction? Thank you!
"Next, when walking through the preparation of your Maryland return, you will come to the screen Capital Gains from U.S. Government obligations are Tax Free. Here you will enter the amount...."
@RachelW33Just like the other poster asked...you stated, "Next, when walking through the preparation of your Maryland return, you will come to the screen Capital Gains from U.S. Government obligations are Tax Free. Here you will enter the amount." I cannot locate that page.
It is handled a bit differently in TurboTax if the capital gains are actually capital gains distributions from a mutual fund reported on Form 1099-DIV rather than a sale reported on Form 1099-B. For mutual fund Capital Gains distributions that include US Government obligations reported on Form 1099-DIV, you would include that amount on the screen that asks for US Government Interest along with the amount of US Government interest reported in Box 1. (screenshot in my answer above).
@RachelW33Can't seem to find that page that you have a screenshot of.
I am not sure why this screen is not popping up for you in the Maryland interview. @mdfiler355 @gjgogol
In order for me to take a closer look, it would be helpful for you to send me a “diagnostic” file that has your “numbers” but not your personal information. If you would like to do this, here are the instructions:
If you are using TurboTax Online:
Here are the instructions if you are using TurboTax CD/Download:
I took a look at your diagnostic file and I believe that the reason that the "Capital Gains from U.S. Obligations are Tax Free" screen is not popping up is because you have a capital loss (rather than a capital gain) reported on Line 7 of your Form 1040. My suggestion is to go back to the 1099-DIV entry screen and include the gain you had on the follow-up screen, Enter U.S. Government Interest. In other words, you would put the total of your capital gain from the sale of U.S. obligations and the portion of dividends that were U.S. Government interest in that box. Doing this will get the Code ab subtraction reported correctly on Line 13 of your MD Form 502.
@RachelW33 I have to bother you again.
I encountered a new problem if adjusting the 1099-DIV as instructed.
When I ran review for Federal return, Turbotax thinks the entry is an error. Because the US treas sale amount is greater than the amount in1099-DIV box 1a.
As I said before, The US treas sales are listed in 1099-B but was adjusted in Form 8949 and included as interest income in Schedule B. These sales are not listed in the 1099-INT nor 1099-DIV.
So making adjustment in the 1099-DIV triggered problem.
And the "Capital Gains from U.S. Obligations are Tax Free" screen does not pop up in my situation.
Is it possible to correct the "Income from us obligations" manually on the form level? Thank you.
Please see this post asking the same question for VA state tax.
Page 9 of Md instructions say the capital gains should be subtracted on line ab. You can do that in the forms mode like this:
@RachelW33I have the form 502SU created in forms. Line 13 has the correct amount on form 502, but I don't seem to get the amount identified on a summary screen in TT step-by-step page. I have included a screen shot of my 2022 summary page that shows the income from u.s. obligations. I've also included a screen shot of the same page from my 2023 return and it does not show the u.s. obligations. Am I doing something incorrectly or is the software misbehaving?
As long as the correct amount for your Code ab subtraction is reported on Line 13 of your MD Form 502, everything is good. Thank you for the screenshots, I am not sure why the experience is different this year. @gjgogol