topic Re: Apparent program error for 2017 M1PR in Deductions & credits

Apparent program error for 2017 M1PR

sbush — Tue, 13 Jul 2021 15:49:30 GMT

I recently received a letter from the State of Minnesota that there was an error on the property tax refund form (M1PR) I filed in 2017. According to the letter, the passive loss on my rental property should have been added back under Additional nontaxable income on Line 5. This has resulted in me owing the state the difference in the refund amount, plus interest.

I pulled up the return in Turbo Tax, downloaded the updates and the amount still does not pull into the M1PR. This appears to be an error in the programming for that form.

Re: Apparent program error for 2017 M1PR

sbush — Tue, 13 Jul 2021 22:20:28 GMT

After doing some further research, the instructions for the M1PR have an extensive list of items that should be added back under additional nontaxable income. All forms from at least 2017 forward explicitly state the following: Passive activity losses in current year in excess of current year passive activity income, including rental losses, even if actively involved in real estate.

I rely on Turbo Tax to know and implement these rules so I don't have to read through the instructions of every single tax form.

Re: Apparent program error for 2017 M1PR

AmeliesUncle — Thu, 15 Jul 2021 03:57:11 GMT

Unfortunately, there are quite a few of those add-back items that TurboTax does NOT do. In addition to the M1PR, it affect a couple of the MN income tax forms as well.