topic How do I enter a "claim of right” credit using TurboTax? in Get your taxes done using TurboTax

How do I enter a "claim of right” credit using TurboTax?

ptazza2 — Mon, 03 Jun 2019 20:12:35 GMT

In March of 2017, I was required to repay my employer $9,000 for relocation bonus including Federal and State taxes paid on my behalf and reported as income in 2016. My employer explained that I would be able to take a “Claim of Right” credit in 2017 for the Federal and State taxes included in the repayment.

Your employer is correct. The IRS provides a couple of d...

DanielV01 — Mon, 03 Jun 2019 20:12:36 GMT

Your employer is correct. The IRS provides a couple of different options: claiming a deduction on your current year income, or a credit based on the change that the amount would have made had the amount been correctly reported to you last year (not required to have been repaid). Click on this link to find an example on how to calculate the best tax treatment for you: Publication 525 - Taxable and Nontaxable Income ... - IRS Tax Map.

On TurboTax, you will go to the Federal Taxes, Deductions and Credits section. You will need to select on Other Deductions and Credits. Then, follow the instructions in the screenshots below. (Please note: the screenshots were taken using the online version of TurboTax. If you are in Desktop, the screen appearance may be a little different but the instructions should be very similar):

How do you claim the deduction for NY state taxes in Turb...

ptazza2 — Mon, 03 Jun 2019 20:12:37 GMT

How do you claim the deduction for NY state taxes in TurboTax?

You can only claim a CREDIT in NY. If you claim the dedu...

DanielV01 — Mon, 03 Jun 2019 20:12:38 GMT

You can only claim a CREDIT in NY.  If you claim the deduction instead, you will not get anything additional in NY.  See this website:  <a rel="nofollow" target="_blank" href="https://www.tax.ny.gov/pit/credits/claim_of_right_credit.htm">https://www.tax.ny.gov/pit/credits/claim_of_right_credit.htm</a>, and download this form <a rel="nofollow" target="_blank" href="https://www.tax.ny.gov/pdf/current_forms/it/it257_fill_in.pdf">https://www.tax.ny.gov/pdf/current_forms/it/it257_fill_in.pdf</a>.  You will probably want to calculate the form manually,because you will need to enter manually into TurboTax directly onto the electronic form (IT-257).

There is a section on the New York Return that discusses Other Deductions and Credits, where you can select Other  Less Common Credits such as this one.  After clicking start, and selecting No on the next screen (assuming your claim of right was not due to you defrauding the government or some other crime,) then you will click on the 5th box, Claim of Right Credit.  This will allow you to input directly onto the form (manual calculations).

Of course, if you have the TurboTax program from the year in question, you can run a mock amended return to find out the amount  of change between the different types of tax by reducing the amount of w-2 pay by the amount you had to repay.  This will recalculate the NY tax, and the difference you will claim by filling out the correct information on the form.  On this comment I cannot provide screenshots, but if you can't find the information I will be happy to post them.

Re: Your employer is correct. The IRS provides a couple of d...

drliz1992 — Fri, 11 Oct 2019 21:16:52 GMT

DanielV01:

Your screenshots weren't posted on the Intuit website. Can you summarize the steps verbally?

Thanks!

Liz

Re: Your employer is correct. The IRS provides a couple of d...

VolvoGirl — Fri, 11 Oct 2019 21:19:31 GMT

This is a new forum layout. Some posts that have June 2019 dates are really older posts from the old forum that got moved over. So they might be for prior years. When they migrated over the dates got changed to June 2019. And the screen shots got deleted.

Re: How do I enter a "claim of right” credit using TurboTax?

ribak — Wed, 17 Mar 2021 02:56:43 GMT

To follow up on this, where can you enter the credit amount on the 1040 using Turbo Tax's online platform? I have figured out how to do this on the NY state form, but cannot figure out how to do this for my federal return. Thank you.

Re: How do I enter a "claim of right” credit using TurboTax?

ErnieS0 — Wed, 17 Mar 2021 03:11:36 GMT

You will need TurboTax CD\Desktop for a claim of right credit.

See the answer by awesome Expert Alumni @BarbaraW22 at claim of right with standard deduction.

You can transfer your tax data from online to desktop. Everything will be transferred up to the moment you click.

Click tax Tools in the left column
Then Tools
In the center box, select Save your 2020 return to your computer