Regarding Missouri Income Allocations; Do I enter all of the MO state refund as Income from Missouri Sources?

[DanielV01]

I'm sorry I didn't explain this well.  What I meant is that the local tax amount is not automatically accounted for in the tax calculation because TurboTax pulls the credit from the net Missouri tax amount, which does not include the local taxes.  That you have to add back in.

[charjean47]

OK.  I don’t have a lot of tax experience.  I will go to the form itself and see if I can override it by combining to two figures.  You have saved me monies.  Thanks for hanging in there with me.

[DanielV01]

It's not a well-know credit.  But you do seem to qualify for it.

[charjean47]

You saved me 448.  Return when from owing 360 to a return of 88.  I am grateful.

[DanielV01]

I thought you might be.  Just make sure you have that info available if Illinois asks for it.  But I can certainly verify it's in their law code to claim both taxes.

[charjean47]

I am reviewing.  IL Schedule CR Column B #41 does not look right to me.  Other Subtractions:  On Column B, Non-Illinois Portion, #39, the 2017 MO refund is entered.   In Column A, #39, amount from IL-1040, Line 7 is entered which is the same amount of the 2017 MO refund.

What confuses me is that instead of Column B #41 being the amount of wages earned from MO, it is less by the 2017 refund.  MO did not tax the 2017 refund in 2017.  Why would the 2017 refund be subtracted from 2018 wages.

Should Column B #39 have the amount of the 2017 refund entered?  Is it ok that Taxes are figured on 2018 wages minus the 2017 refund.

I know this came about when the program asked where did the refund come from and I answered the full amount came from the other state.  It just looks wrong to me.

Thanks

 

[charjean47]

I am reviewing.  IL Schedule CR Column B #41 does not look right to me.  Other Subtractions:  On Column B, Non-Illinois Portion, #39, the 2017 MO refund is entered.   In Column A, #39, amount from IL-1040, Line 7 is entered which is the same amount of the 2017 MO refund.

What confuses me is that instead of Column B #41 being the amount of wages earned from MO, it is less by the 2017 refund.  MO did not tax the 2017 refund in 2017.  Why would the 2017 refund be subtracted from 2018 wages.

Should Column B #39 have the amount of the 2017 refund entered?  Is it ok that Taxes are figured on 2018 wages minus the 2017 refund.

I know this came about when the program asked where did the refund come from and I answered the full amount came from the other state.  It just looks wrong to me.

Thanks

 

[DanielV01]

Those boxes (39 and 41), goes to your original question and my original answer.  Since last year's Missouri state refund was included in your taxable income for your Federal Return, those lines on the IL Schedule CR is subtracting that income back out because Illinois does not tax it.  That has nothing to do with the credit for taxes paid to Missouri and St. Louis this year.  

[charjean47]

I understand the above regarding Column A (Federal 1040).  I just did not understand Column B, the Non-Illinois Portion, where the 2017 refund was subtracted from the 2018 MO wages.  It doesn’t matter now.  You beat me with your answer.  I was just going to let you know that I called IL REV and they told me that Column B was right; MO 2018 wages minus the 2017 refund.  I did not understand the logic.  Your time spent saved me 448.  Thanks.  Over and Out.

[charjean47]

Just had to get back with you.  This is an end to my questions.  I could not override the forms, however, my returns are done.  I went back to review IL and when I was on the “OTHER STATES INCOME AND TAX SUMMARY page, I chose “add another state”.  I listed MO, did not add more wages, but entered the amount of taxes paid to St. Louis.  As soon as I hit enter, the amount I owed in RED change to the Refund.  As I told you before and I am saying it again, because of you I saved 448.  Good bye for now.  Thank you for helping so many people; over 5,000.  You went the extra mile with my situation and researched to help me.

[DanielV01]

I enjoy assisting people.  I'm glad I could help you as well.

[charjean47]

Hi Turbo Tax DanielV.  The other returns you helped me with were actually my sons and he is delighted that you saved him $448.   My husband and I have 7 rentals and I have the returns done with one exception.  It is not a big deal.  We bought a storage shed for $200 and had it moved for $300 and built a ramp for $50.  I thought the $550 should be an improvement and that I could use the Safe Harbor and count it as an expense.  When I asked the community to verify that it is an improvement, I was told that the shed is not an improvement.  If it is not an improvement, I don’t see how it could be a repair or fall under any other catagory.  Am I missing something?  Do you think the $550 shed is an improvement?
If it is an improvement, I can use the Safe Harbor, correct?  Thanks

[DanielV01]

It is a depreciable asset, so you can use the de minimis safe harbor treatment on it, but it is not an improvement.  An improvement would be something like a basement remodel or a room addition.  Those kind of improvements are not eligible for the safe-harbor treatment.  But your shed is eligible.

[charjean47]

Thanks again.