Minnesota State, the software is miscalculating the "Social Security Benefit Subtraction" that shows on line 12 of the Schedule M1M. Anyone else seeing this glitch?

[tjug796]

It is calculating 4x what it did last year on similar SS income.  There has to be a calc problem.

[SteamTrain]

It's not necessarily a glitch......the amount does depend on you total AGI, but if line 6b of your form 1040 last year was low, it is possible that amount is higher this year too.  And in certain situations taht amount cna be higher for 2023.

See the line 12 worksheet for the MN Form M1M for details on how it is calculated, but if your income falls below a certain level, the value of line 6b (of the 1040) is used without any additional calculations:

Form Search | Minnesota Department of Revenue (state.mn.us)

[tjug796]

Turbotax calculated $19,967 for Schedule M1M line 12.  The MN Dept of Revenue site says the max amount for single filer is $4,560.  I checked previous years returns and it has always been in that same general area just a little lower.  

Turbotax you have a calc error!!!!!!!!!!!!!!

[DawnC]

The max is the amount on Line 6b of federal Form 1040.    Instructions for Line 12 — Social Security Subtraction If you had a taxable Social Security benefits on line 6b of Form 1040 or 1040-SR, you may be eligible to subtract those benefits from your Minnesota taxable income.   Enter the full amount from line 6b of Form 1040 or 1040-SR on line 12 of Schedule M1M, if your adjusted gross income was below these amounts based on your filing status: 

• Single or Head of Household: $78,000 

• Married Filing Jointly or Qualifying Surviving Spouse: $100,000 

• Married Filing Separately: $50,000 

If your adjusted gross income is greater than these amounts, you must determine your subtraction using the Worksheet for Line 12.  Your subtraction equals the greater of step 8 (Simplified Method) or step 28 (Alternative Method).  

[tjug796]

I very much appreciate your help with this.  If you will be so kind as to look at the below summary for the last few years you will see that something is drastically different in how the Social Security Benefit Subtraction flowed through this year vs. previous years.

2020

Federal AGI - $44,450

Form 1040-SR - line 6b - $12,672

Social Security Benefit Subtraction - $4,090

2021

Federal AGI - $47,931

Form 1040-SR - line 6b - $14,301

Social Security Benefit Subtraction - $4,130

2022

Federal AGI - $52,644

Form 1040-SR - line 6b - $16,788

Social Security Benefit Subtraction - $4,260

2023

Federal AGI - $58,466

Form 1040-SR - line 6b - $19,967

Social Security Benefit Subtraction - $19,967!!!!!!!!!!!!!!!!!!

This matches line 6b when it has always matched the MN Dept of Rev "Max"

This was filed in February and MN Dept of Revenue just sent a correction letter and they added back the $19,967 to taxable income, which is why I am having to dig into this.  

I appreciate your expertise and input.

[DawnC]

They will correct their 'correction'.   See this link from the MN Dept of Rev regarding law change for 2023 - Beginning with tax year 2023, there are two methods for calculating the subtraction: the “simplified method” and the “alternative method.”

The simplified method allows taxpayers with adjusted gross income below $100,000 for Married Filing Jointly, or below $78,000 for Single or Head of Household, to subtract all their Social Security benefits included in adjusted gross income (AGI).

[tjug796]

Thank you so much.  Would my next step be to submit an appeal to their correction?

[DawnC]

I would do that and/or contact them if they have adjusted your return.