The TurboTax interview question relating to Scholarship Contributions for the Oklahoma state return is deceptive and the review process insufficient. I, as many taxpayers do, contribute to nonprofits that offer scholarship support to college students. The Oklahoma TurboTax interview asks "did you contribute to a scholarship?" and provides an opportunity to input an amount. I truthfully answered yes and inserted a value when preparing my return. My state form passed review with no issues, but I noticed my state tax liability was less than half what I expected. I traced the reduction in tax owed to the Oklahoma form 511CR Schedule for Other Credits, line 22 which gives a state tax credit for "Credits for Contributions to a Scholarship Granting Institution". Only by tracking down the full 511CR-19 form from the Oklahoma Tax Commissions web site and reading the lengthy instructions did I find a buried sentence "A scholarship granting organization means a nonprofit organization, registered with the Oklahoma Tax Commission, which distributes scholarships so an eligible student, or an eligible special needs student, can attend an elementary or secondary private school." Both the Oklahoma forms 511 and 511CR are deficient and misleading in not specifying the "elementary or secondary private school" limitation to this credit. The TurboTax interview propagates this deficiency and sets-up an honest filer to submit a fraudulent return. Both the TurboTax interview and the Oklahoma forms should be amended to correct this deceptive defect. I can not find a way other than this forum to report this issue to TurboTax for their consideration for an improvement.
