Unexpected tax refund

[tovaface]

A couple weeks ago we received an unexpected refund from the IRS, the stated reason being, "Excess advance premium tax credit repayment."  While this is certainly a nice surprise, why didn't Turbotax figure the amount correctly in the first place? What else did it get wrong?  Does this mean I don't owe the amount deferred until Dec. 31, 2022, i.e. the amount on Schedule 3, line 13 and Form 1040, line 31?

[rjs]

TurboTax figured the amount differently because Congress changed the law after you filed your tax return. The TurboTax calculation was correct at the time that you filed. The IRS is now going through all the tax returns that were filed with repayment of excess advance premium tax credit and sending additional refunds.

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@tovaface wrote:

Does this mean I don't owe the amount deferred until Dec. 31, 2022, i.e. the amount on Schedule 3, line 13 and Form 1040, line 31?

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No, it does not mean that. The refund that you got is for the additional tax on Schedule 2 line 2. You still owe the deferred tax on Schedule 3 line 12e. Half of the deferred tax is due by December 31, 2021, and the other half by December 31, 2022.

[tovaface]

rjs: I filed on April 5, 2021. When did Congress change the law?

When I updated TT  (I have the Home and Business Desktop version) on May 31, several entries on Schedule 3 changed, which did not appear to be right.  I spoke to a TT technical expert about it who said it was due to a glitch in the update and had no idea how to fix it.

It was painfully difficult to find an answer on TT or from the tech support to my question on when the deferred payments are due. So thank you for providing that information so quickly.

[rjs · Accepted solution]

The president signed the law on March 11, but the IRS didn't issue instructions for making the change in tax returns until April 9.

There have been several TurboTax updates since May 31. If there were bugs in the May 31 update, they might have been fixed in subsequent updates. You should update your software again and see if it affects your tax return. Save a PDF of your tax return before you update, so you can compare.