Form IT-558

[sejournist]

For some reason, this year Turbo tax did not include and compute Form-558 with my tax return. Is there a glitch with the system?

[JohnW152]

No, there are no known issues with New York Form IT-558.

You may want to make sure that you still qualify for the decoupling adjustments reflected on the form.  According to the Instructions for Form IT-558: 

You should make New York State adjustments due to decoupling from the IRC using Form IT-558 only if: 

• you are a partnership and are a partner in one or more partnerships and you received Forms IT-204-CP and IT-204-IP from those partnerships and an amount was reported to you in the Partner’s share of New York adjustments due to decoupling from the IRC section, line 1 or 2 of those forms. 

• you are a partner in one or more partnerships and received Form IT-204-IP from that partnership and an amount was reported to you in the Partner’s share of New York adjustments due to decoupling from the IRC section, line 1 or 2 of that form. 

• you are a shareholder of one or more federal S corporations for which the election to be a New York S corporation was in effect for the tax year, and the S corporations provided you any addition and subtraction adjustments because of New York State decoupling from changes to the IRC after March 1, 2020. 

• you are a beneficiary of an estate or trust and the estate or trust reported adjustments to federal taxable income because of New York State decoupling from changes to the IRC after March 1, 2020.

[EdithM]

To add to the above response, the IT-558 handles New York decoupling with federal IRC provisions, applied for tax years beginning before January 1, 2022.  So for an individual, they may only need to file an IT-558 if they had pass-through income, a K-1, and that entity had a fiscal year end other than December 31, and had one of the adjusting items.  

[sejournist]

The thing is NYS sent me a request for this form, but I don't think any of the items you outlined apply to me.  So I am not sure how to approach this request from the state.

[EdithM]

Was the request from NYS for tax year 2022?  Or one of the prior two years?  

[sejournist]

The request is for 2022 only. Looking back actually, there was never a filed IT-558 for any of my prior tax returns. I don't know what I did wrong on my 2022 Turbo Tax return that would have NYS ask me to filed a IT-558 this year.

[HopeS]

Based on your last response, it appears you don't need Form IT-558 since you did file one in 2020 or 2021. Therefore, you can delete this Form from your Tax Return.

This Form was new for 2020which adjusts your federal adjusted gross income. Certain items this year are being added back and subtracted from your federal adjusted gross income. It is similar to the previous year's Form IT-225, except that it is included items that cover the CARES Act.

Below is a summary of the two most common reasons of why Form IT-558 would be added to your NYS return.

• Covid-19 related distributions from a retirement plan
  For distributions taken from retirement plans, NY is requiring that the entire amount be added back to Federal AGI, and then taxpayers will subtract out any taxable amount already included in the federal AGI.
• Adjustments for charitable contributions
  Created as a new charitable deduction for those taking the standard deduction on their federal return of up to $300. This amount is required to be added back to income for NY purposes.
• There are many other reasons that would require you to file this new NYS form. You can read more about Form IT-558  below:

Here is New York tax law update: 

What you need to Know

To Delete Form IT -558

1. Select Tax Tools from the menu on the left.
2. Then select Tools.
3. When the new menu pops up select Delete a Form.
4. You will see a list of all the forms in your return.
5. Find the form that you want to delete.
6. Select the Form.
7. Click Delete on the right

@sejournist