Iowa 2017 - Has claimed that the Taxes done are wrong. Letter. The DD Info W2 is automatically used on the State taxes as well and reduced the overall taxable income.

[shammu]

Received a Letter from the State of Iowa that I owe them taxes.

Used the TurboTax online product to file my taxes with no complications. Straightforward W2 from one employer. Auto imported as well. Did not enter anything manually. No itemized deductions.

Problem Area: The line DD on W2 has an amount; which has been imported onto the State area as well. This number has been deducted from the overall income before the taxable income has been calculated by TurboTax. Not sure why.

However, the letter from the State of IOWA claims that "The code DD on your W2 is the amount your employer paid for your health insurance and does not qualify for the adjustment".

Whats my next step?

[Critter]

Any calculation errors on the part of TurboTax are covered under the Accurate Calculation Guarantee. TurboTax will pay any penalties and/or interest due to a calculation error but not any taxes owed. The Guarantee does not cover any user entry errors or omissions.

See this TurboTax support FAQ for the 100% Accurate Calculation Guarantee - https://ttlc.intuit.com/questions/2566201-what-is-the-turbotax-100-accurate-calculation-guarantee

See this TurboTax support FAQ for submitting a claim - https://ttlc.intuit.com/questions/1901269-how-do-i-submit-a-claim-under-the-turbotax-100-accurate-ca...

See this TurboTax support FAQ for documents needed to submit a claim - https://ttlc.intuit.com/questions/1901060-what-documents-do-i-need-to-submit-a-claim-under-the-turbo...

[BMcCalpin]

First, the State is correct: the amount on your W-2 in box 12 with a code of DD should not be deducted separately on your state return, because the code DD amount was already removed from the federal Wages on your W-2 and therefore did not carry to your state income anyway.

I see a number of possibilities:

1. The W-2 was not imported correctly. On occasion, the auto-import feature to import a W-2 fails. This can cause TurboTax to be confused as to what was actually on your W-2 and possibly make erroneous entries in your state return. The auto-import feature is most likely to fail if the company that created your W-2 data packet did so incorrectly or if the import got garbled in the process of transmission.

2. You entered this number someplace in the Iowa interview. I know you said you didn't enter it manually, but it's still a possibility.

3. The number that the State flagged actually wasn't the code DD amount, but was something else that happened to be the same number so the State mistook it. IN this case, the number might be correct, for a different reason.

On what line did this dollar amount appear on your Iowa return? That would help everyone understand how the number got there.

Although none of these possibilities is particularly likely, they are something to look for as you review your return. Then contact the people that Critter referred to above so that you can be ready for the conversation.

[shammu]

1. Quite possible that this happened. 

2. I am a noob when it comes to taxes. So If I need to do enter something, I will not do it all and chose to visit a local place to get it done. I can guarantee this a 100%. 

3. I scanned the entire Tax Return for a similar number. This DD value is the only value that comes close (actually off by 5 cents on the line DD but rounded off everywhere else). All other values are hundreds of dollar different. 

What line did it appear on the State Return? 

IOWA - Line 18

[shammu]

Thank you for the valuable links

[BMcCalpin · Accepted solution]

Line 18 on the 2017 Iowa 1040 refers to the Health Insurance Deduction. As you saw, this should be any amounts for health insurance premium that are NOT already pretax (i.e., the amount with code DD, which is pretax because it is not included in your Wages in boxes 1, 3, and 5 on your W-2). So it seems that the State had the number correctly identified.

In my pre-existing test, line 18 was filled in with the self-employment health insurance deduction from a sole proprietorship and from Medicare premiums, both of which are correct. The code DD amount did not carry from the W-2.

Note that both my amounts carried over automatically from places on the federal return. In fact, I just walked through the Iowa interview (for 2018, because I don't have Iowa for 2017), and there wasn't even a place for me to manually enter an amount that would go to line 18.

So this suggests either a failure on the auto-import or a programming error (which is hard to believe because this would be such an obvious error).

In the process of reporting the problem that Critter described above, you will be asked to created a data file from your tax return. When you send this to the appropriate destination, the problem should be quite obvious to Support.

[shammu]

So the claim that I filed just got denied and TurboTax claims that the number was entered wrong. However takes no ownership of the error. 

As you have mentioned, I did not enter this number manually anywhere; as I am a noob on taxes. Not sure where to go from here. The email cannot be replied to. This is frustrating for no reason. 

[Critter]

No one on this forum can talk to you on this situation ... the accuracy claim denial should have has some explanation as to why but only TT support can discuss this with you...  

Contact TurboTax support and speak directly with a TurboTax support agent concerning this situation.

See this TurboTax support FAQ for a contact link and hours of operation -https://ttlc.intuit.com/questions/1899263-what-is-the-turbotax-phone-number

[ankaratop]

2021 TT also led me to believe that Iowa taxes due equal zero. non-resident with IA income. Spoke to the IOWA tax support this morning and they confirm the numbers don't add up. IA form 126 for income did not have the correct calculations although the income was present on the 1040. I've been burned by this before. TT needs to audit this income vs minimum income tax exemption they tried to hand me.

[BillM223]

@ankaratop

If you believe that an error on the part of TurboTax cost your penalties and interest, then you can apply to the Tax Accuracy Calculation Group for relief. I will repeat the links that Critter gave above:

See this TurboTax support FAQ for the 100% Accurate Calculation Guarantee - https://ttlc.intuit.com/questions/2566201-what-is-the-turbotax-100-accurate-calculation-guarantee

See this TurboTax support FAQ for submitting a claim - https://ttlc.intuit.com/questions/1901269-how-do-i-submit-a-claim-under-the-turbotax-100-accurate-ca...

See this TurboTax support FAQ for documents needed to submit a claim - https://ttlc.intuit.com/questions/1901060-what-documents-do-i-need-to-submit-a-claim-under-the-turbo...

If tis is not the case however, it would be helpful if you could tell us which lines you think are incorrect and what values they have. As you know, we in the Community cannot see your private tax data.