Thank you for taking the time to respond! I agree that Oklahoma has a $17,000 cap on itemized deductions. However, that is not the issue here. The issue I have is with OK Schedule 511-D Line 2 related to the addback of state and local income taxes. Turbotax is reporting a limited addback based on the prior year $10,000 SALT cap that was in place on the federal return (which has since been raised to $40,000 under the OBBBA for 2025). To illustrate, I put in that I had $10,000 of state income tax and $5,000 of real estate tax on Schedule A, for a total deduction of $15,000 (note that I am not limited this year as I would have been in the prior year under the $10,000 cap).
For the Oklahoma return on Schedule 511-D Line 2, I need to add back state income taxes deducted on the federal return. Instead of adding back the full $10,000 that I was able to claim on the federal return, Turbotax is adding back $6,667 (which represents the pro rata state income tax that would have been deducted had I been capped under the $10,000 limit) (e.g. $10,000 state income tax / $15,000 total tax deduction times $10,000 limit). Unless I am mistaken and Oklahoma is still applying the prior year SALT cap, then it seems that this is a calculation error on Turbotax's part and Turbotax is overstating Oklahoma itemized deductions.
