QBI Deduction calculation for estimated tax not working properly

[aeroj27]

I am trying to let turbo tax calculate my estimated taxes for 2023, but I cannot figure out how it is calculating the QBI deduction. Here is the scenario:

Married filing jointly

Business is a SSBT

Schedule C income = $334,535

1/2 of SE tax = $14,412

Self Employed healthcare premium deduction = $26,640

Standard deduction for 2023 is $27,700

QBI deduction should equal $53,157 ((334,535 - 14,412- 26,640-27700)*.20)

But turbo tax is calculating QBI deduction amount to be $63,000. If the schedule C income amount is changed to $334,534 it calculates correctly.  Not sure if there is something I am missing on how it is being calculated.

[AliciaP1]

It would be helpful to have a TurboTax ".tax2022" file that is experiencing this issue.

You can send us a “diagnostic” file that has your “numbers” but not your personal information.  If you would like to do this, here are the instructions: 

In TurboTax Online, go to the black panel on the left side of your program and select Tax Tools. 

1. Then select Tools below Tax Tools. 
2. A window will pop up which says Tools Center.  
3. On this screen, select Share my file with Agent. 
4. You will see a message explaining what the diagnostic copy is.  Click okay through this screen and then you will get a Token number. 

In TurboTax CD/Download versions, go to the black panel on the top of your screen and select Online. 

1. Scroll down to and select Send tax file to Agent. 
2. You will see a message explaining what the diagnostic copy is.  Click send through this screen and then you will get a Token number. 

Reply to this thread with your Token number. This will allow us to open a copy of your return without seeing any personal information.   

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution.

@aeroj27 

[aeroj27]

Hi @AliciaP1 ,

I called the turbo tax phone number earlier and provided them the file. They are running a diagnostic. I am waiting to hear back from them. 

Thanks,

[aeroj27]

Hi @AliciaP1 ,

Providing an update. It's been almost a week and Turbo Tax IT support was supposed to call me and they still have not. I have tried to get a hold of someone thru the 800 number, but my call was dropped by the first support person. The second support person's system was not allowing her to transfer my call to the resolution support team and said she would restart her system and call me back in 5 minutes. I was never called back. I am now on hold for the third time in a row and I have been on the phone for almost 3 hours and I haven't even been sent to a person that can help me!!!

[aeroj27]

Hi @AliciaP1 ,

Final update. The IT support team would not confirm if the calculation was incorrect because they will only let a Tax expert or CPA confirm that it is calculating correctly. But I can override the number that turbo tax is calculating if the amount I feel is incorrect based on what I have calculated using the IRS forms 8895 and 8895a. 

[AliciaP1]

The purpose of estimated taxes is to reduce the amount of underpayment penalty you may be charged if you don't pay enough tax during the year.  You can manipulate the calculation to whatever you think is most accurate for your situation.  Even if you leave the TurboTax calculations and still want to use the forms provided to pay your estimated taxes through 2023, you can always write in the amount you are actually choosing to pay.  If you want to ignore the TurboTax estimated calculations completely you can download a blank Form 1040ES and pay whatever amount you are comfortable with during the year.

@aeroj27