Add the two state tax refunds together and enter the sum as the total state tax refund. When filing a joint tax return there is no need to indicate who the state tax refunds belong to.
That makes sense, however why does turbo tax ask about my 2015 federal return? Does that go into calculating how much of our return is taxable. If so... my husband made more in 2015, so in turn paid more in state taxes in 2015..yet its not showing that, because it only shows my 2015 federal tax return.
You probably started the 2016 return using the same user ID used to create the 2015 online return and your Single tax data transferred over to the 2016 return where you are now filing a joint tax return.
thats exactly what i did. So how do I put his 2015 in? It only allows for one.
When filing a joint tax return the program uses the words 'you' or ''your' with the meaning to include both of you.
When entering any type of income, like from a W-2, the program income sections will either have separate buttons to click with each of your names for entering income or there will be selections on the income entry screens to select who the form belongs to.
If you have something specific that is in doubt how to enter, reply back and I should be able to get you an answer.
Thats just the thing. For everything else there is a button to select who ( w-2, hsa,etc). This does not. And I was just on the phone with turbo tax for over an hour and they can't believe they have never ran into this issue before, but they agree there's no where to put both 2015 federal tax returns so that I can then enter both 1099-g forms and not get penalized. It does say "your" federal tax return which yes it is...but there is no where to put his.
And I can't just manually put in our 2015 tax return and add the numbers together from each of our separate federal tax returns. I have used turbo tax since 2012 and due to a flaw in the system that they never knew existed I can't use them since I got married in 2016. I am afraid that plenty of newlywed couples that used this tax form have probably lost out on money as well.
For the state income tax refund, I do not see how that would be a problem. If both state tax refunds are from the same state then you should just be able to enter the total amount received after selecting the state. If the state tax refunds are from different states, once you enter the refund for one state you can enter other state refund for a different state.
Since you are adding both of your incomes, deductions and exemptions on the same tax return, I don't see how entering both state tax refund would be penalizing you on your tax return. If you both itemized your deductions in 2015 then both the state tax refunds would be income on your 2016 tax return. If one or both of you did not itemized on the 2015 return then one of the refunds or both should not be entered as income on the 2016 return.
IT ALLOWS ME to enter both state income tax refunds!! IT HOWEVER DOES NOT ALLOW ME TO ENTER BOTH 2015 RETURNS ... it only lets me claim my own 2015 and then I get penalized for his large state refund without getting credit for his 2015 federal.
Maybe I am not understanding what you are doing here. When you say entering the 2015 returns, what do you mean?
What 2015 tax data are you needing to enter from his 2015 tax return to the 2016 tax return?
This is not an unusual situation when filing a joint tax return in the current tax year where both the prior year tax returns were filed as Single.
They ask you for your 2015 federal tax return information if you enter your state income tax return (1099-g). You hit continue and it asks you to verify your 2015 tax return information to see if the income tax refund you received can be taxable for 2016. HOWEVER IT ONLY ALLOWS YOU TO ENTER ONE 2015 FEDERAL TAX RETURN not both ! SO you get punished for entering both state income tax refund (single since we weren't married yet), but it only allows for credit for one 2015 return!!!
I think you just don't understand the situation..but I appreciate your attempt to help. The help team at turbotax couldn't even help so I am going to have to go elsewhere to file since we got married in 2016.
Sorry, that I was not able to help you out. I will go and create a test return and see if I can find a solution to this. Can't believe the programmers at TurboTax did not get this type of situation resolved in the current software.
That would be great! If there is no resolution it means that anyone that files their taxes with turbotax in the first year they are getting married gets penalized on the their state income refund because they aren't able to put in both. In my opinion they owe a LONG EXPLANATION / compensation to anyone they have screwed out of money due to the inability to enter both previous years federal tax returns.
Okay...Back again. I created the test return and saw what you were describing.
The situation would only occur if both of you used itemized deductions in the prior tax year on Form 1040 Schedule A and the itemized deductions were greater than the standard deduction for your filing status. For tax year 2015 since you were filing as Single the total itemized deductions on Schedule A would have to be greater than $6,300.
You are correct, the program will only take the entries for one taxpayer to calculate the correct amount of state tax refund to enter on the 2016 tax return if the person used the itemized deduction on the prior year tax return instead of the standard deduction.
So my question is, did both of you use itemized deductions on your 2015 tax return? The entry would be shown on the 2015 Form 1040 Line 40 and the amount shown would be greater than $6,300.
Yes we both used itemized deductions on our 2015 tax return.
I have posted this problem to the other SuperUsers and to the TurboTax Moderator of this forum to see if anyone recalls a discussion of this problem in the past. There may have been a workaround or this may well be just a limitation in the software. Hopefully I will get some feedback on my question this weekend or early next week.
@rvierling09 - I have received a response for your situation from SuperUser @rjs which is along the line that confirmed what I thought needed to be done to properly report the taxable portion of both state tax refunds.
Here is their response -
"TurboTax is not set up to handle your situation correctly. The right way to do it is to calculate the taxable portion of your own refund using information from your 2015 single return, and calculate the taxable portion of your husband's refund using information from his 2015 single return. But TurboTax is set up to only do one such calculation, using information from only one 2015 return. Here are two options for handling it.
1. Treat both of your refunds as fully taxable. That's the most common result anyway when you both itemized for 2015. If you choose to do this, you can enter the two refunds separately, or enter the total of both refunds as if it were one refund. Since you transferred information from your 2015 return, you will get a screen that says "Confirm Your 2015 Federal Return Info." It displays information that was transferred from your 2015 return and asks you if it's correct. Answer No, that it's not correct. Two screens later you will get the choice to either enter information from your 2015 return or make your full refund taxable. Choose the option to make the full amount taxable.
2. Do the calculations of the taxable amount yourself outside of TurboTax. You have to do the calculations separately for each of the two refunds. You can probably use the worksheet for Form 1040 line 10 that's on page 24 of the IRS instructions for Form 1040, but check the "exceptions" listed in the instructions on pages 23 and 24 to see if you have to use Worksheet 2 on page 25 of Publication 525 instead. Add together the taxable amounts from the two calculations, and enter that total as the refund amount in TurboTax. Then follow the instructions in option 1 above to treat the full amount as taxable."
The Form 1040 instructions from entering state/local tax refunds start on page 23 of the instructions with the worksheet on page 24 - <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/i1040gi.pdf#page=23">https://www.irs.gov/pub/irs-pdf/i1040gi.pdf#page=23</a>