Is TurboTax under Iowa State Return Prior Year Federal Tax incorrectly applying 2022 Federal Income Tax paid instead of tax paid in 2023 for 2022?

[CDM6]

TurboTax is incorrectly handling the Iowa State Return.  Iowa substantially revised their State return for 2023 using an entirely different method which now incorporates a schedule 1.  TurboTax under Enter Your Federal Tax Info it defaults 2022 Federal Refundable Education Credit.  However, the Iowa 2023 1040 Instructions state "Do not include federal refundable credits such as earned income tax credit, additional child tax credit, refundable education credit, net premium tax credit, or recovery rebate credit."

TurbTax under Prior Year Federal Tax is incorrectly applying 2022 Federal Income Tax paid in 2023.  The statement on the page is incorrectly stated "Tell us about your federal income tax after non-refundable credits for 2022 or prior years."  However the link to Federal Income Tax on the same page states to "Enter any federal income taxes paid in 2023 for 202 or earlier years."  TurboTax is defaulting to 2022 tax paid, but the new Iowa State tax rules only want 2023 taxes that were paid for previous years.  Obviously if I did not pay any taxes in 2023 for previous years the entry would be zero.  However, if entered as zero, TurboTax acts if there is no deduction and taxes income incorrectly. It almost appears TurboTax is using 2022 tax forms instead of 2023.

I have completed the Iowa State tax return manually and have read the entire Iowa 2023 1040 Expanded Instructions to know TurboTax is incorrectly processing the Iowa State Return incorrectly.

My only alternative is to manually file or use another electronic filing program.

Do you have any resolution to offer?

[LeticiaF1]

This is a known issue that should be resolved with the March 29th update. Once the update happens, please follow the steps below depending on the version of TurboTax you are using:

• If using TurboTax Online: Clear your cache and cookies. See this FAQ, for your particular browser.
  • You can also try using a different browser
• If using TurboTax Desktop: Please see this FAQ.
  • Make sure you have ran all the updates