I e-filed for 2020 and was rejected due to an error in my taxable inherited IRA. I dont have any inherited IRAs. I did have a Roth conversion just like other years. Is there a bug in Turbotax this year?
^^ See the "Caution:.." thread below on the problems we've IDed with the "Inherited and Personal IRA" basis and comingling of $ with the math being totally wrong. I suspect the entire IRA math stream in TT 2020 is impacted. Thusfar, TT appears to reading from their L1 playbooks - we don't have a problem. Several members have outlined in detail what's happening in that thread.
It appears that all tax returns that include Form 8606 Part I are being intercepted while the developers fix a problem related to distributions from inherited IRAs. I don't think it's meant to indicate that your tax return reports a distribution from an inherited IRA.
Thanks for the update! FWIW, I "fiddled around" the the individual forms today. I was able to find the right fields to over-ride the basis value for the Inherited IRA (0) and also correct the Individual IRA contributions and that separate basis listed on the 8606 forms. The numbers look much better now. I also got the red "!" to disappear by editing the correct fields - which is not always the first one you click on... you may have to follow it down the rabbit hole. No red "!" still does not mean it will pass the eFile verifiers. I'll be patient while TT fixes this issue (hopefully before filing deadlines). See the thread I referenced above.
I also noticed there was a large update applied today when I opened TT2020. Stay safe, stay alive! Peace.
Finally, an answer! I couldn't figure out why my return kept getting rejected too. I don't have an inherited IRA either, so it looks like we indeed just have to wait for the patches to be applied to turbo tax.
Thanks I got the same message when I filed over the weekend. Looks like TT should have it fixed by March 5th based on the message I received from TT.
Another tax submission rejected with this issue... March 5... here we go...
Installed today (3/4/2021) update, resubmitted and got rejected again.
Same! The error message in TT even says the error should be fix with the software update that has already been installed. What a joke.
I filed my completed 2020 TT forms on 3/1/21 after running all the tests for accuracy. Like many of you, I was informed that the return was not accepted due to a "potential issue with the calculation of your Taxable_Inherited IRA." I have never inherited an IRA. And, I checked all of my IRA forms of both my 2019 and 2020 TT work sheets to make sure I had not accidentally marked the inherited boxes; I had not. I do notice that one of my 8606 forms from my 2019 TT forms did not seem to transfer to this year's working file.
So, I too am waiting for tomorrow at which time TT said they would have a fix although I notice that all references to this problem have disappeared from my working version. I have no idea how to access the solution if and when it becomes available
Yes, I have read all the comments on this issue today. Similar error on my documents sent on the 3rd. Here it is Friday the 5 and I have loaded the TT with today's updates but I do not see anything that advises the Inherited issues is addressed and corrected. Very hesitant to hit the Transmit Returns button recognizing that some have tried and again failed. Does anyone know how to actually contact someone at TT?
Running Deluxe CD Version
I got the same error last Monday (3/1/2021).
Downloaded the update this morning and resubmitted.
Just got a notice that the Federal Return was accepted!
Still waiting to hear about NJ Return.
Just off the phone with TT. After 20 minutes of walk-through documents, etc nothing was found to indicate wrong inputs. The person noted that TT indicates they are working with IRS to correct the issue and it should be fixed by end of today. They suggested waiting till Saturday or Monday to resend transmission.
It's Mar 7 and this issue still isn't fixed. I am a retired tax professional and this is beyond frustrating.
I found that TT has "fixed" this glitch. Go to the review section and at some stage it will say that the problem has been corrected. I could not find the exact screen which told me that as I filed again yesterday and received a message that the IRS had accepted my return: now I am not picking up the screens which told me the problem has been fixed.
But I have another problem which no one at TT responds to. My return does not contain a T-8606 form.
It has an S-8606 form for my spouse who withdrew her full RMD last year even though she did not have to. And, I withdrew $7500 from my IRA before the 2020 RMD's were cancelled. I donated this $7500 to a charity which means none of it was taxable. But, my guess is that it should have been recorded on my 8606 since it results in a deduction of my IRA's value. But, my 8606 did not transfer from my 2019 TT computer file. I have no idea how to import it into the 2020 file and, of course, will depend on it being there when I get around to doing my 2021 taxes if I decide to use TT again. OH ME!
Suggest you update your copy on your computer that way it is available for next year's upload. One thing I believe folks do not realize is that the 8606 form also serves to recognize that your additional payments to IRA are recorded and credits given to your yearly submittals. It is not very apparent and it would have slipped by me if I did not ask a CPA some years ago. The CPA noted that the IRS does not give you lump-size credits - that the dollar amount is low compared to your investment and will take years to cover all amounts.
Perhaps I'm late to the party. I do have an inherited IRA. Two weeks ago, I entered my 1099-R into Step by Step, the fields for box 1 (Gross distributions) and box 2 (Taxable amount). When I printed out Form 1040, only the box 1 entry flowed into 1040 Line 4a. The Box 2 entry should have been on Line 4b, but was 0.
Two days ago, when I updated the software (for other reasons), the box for 1040, 4b had the correct entry. Seems like there are other problems afoot besides the ones described earlier.
^^^ I've not tried to update any forms yet and remove my overrides. As I mentioned in another thread, I'll make a copy of the file as a fall-back before undoing my overrides to make the numbers agree before TT has supposedly fixed it.
^^^ There is a "manual form mode" I've seen to add forms of your choosing. I've never had to use it b/c the guided forms always got the forms right. If there are any red "!", in front of a form, you cannot file it.
^^^ WRT 8606 forms, my accountant said they should should be "retained indefinitely" to prove any yearly non-deductible contributions down the road.
I'm so hoping this is fixed, otherwise we cannot eFile and must print everything and figure out how to correct the TT "faulty math..." Stay safe, stay alive! Peace.