I'm using Desktop version of Turbo Tax Deluxe for tax year 2021
(Sorry this is long, but I think it's most efficient to put all info in the original post rather than lots of questions back and forth.)
I'm concerned that TurboTax is putting incorrect amounts for my cumulative California AGI for the first 3 periods in Form 5805, Part III Line 1. It's putting the same amounts for my CA AGI in columns (a), (b) and (c) as it shows for my Federal AGI in the analogous table for annualizing federal income in Form 2210, Schedule AI, Part 1. My CA AGI numbers should be less than my Federal AGIs because part of my income is Social Security and CA doesn't tax SS.
Therefore, for me, my correct CA AGI for each tax period should be: Federal AGI minus my federally taxable SS as it accrues throughout the year (which is 85% of my SS for tax year 2021). Instructions for Line 1 of the Part III table specifically say, "Enter your California adjusted gross income (AGI) for each period" and CA AGI can be different from Federal AGI.
In the 5805 Part III table, TurboTax does put in my correct CA AGI for the 4th period (ie the full year), but it doesn't subtract out the SS portion of my income in the first three periods. So, TurboTax seems to be calculating the 4th period CA AGI correctly, but not for the other three periods. TurboTax should have automatically calculated all four of my CA AGIs for Form 5805 by subtracting out my federally taxable SS (and incorporating any other additions or subtractions due to differences between CA and Federal tax rules). Turbo Tax has all of that information based on our interview answers. I hope Intuit will address this problem.
TurboTax calculates I have no penalty for CA and I owe $1 penalty to the IRS (because one of my estimated payments was a few days late). I always pay more than the table says I owe for a period because I don't want penalties. In my particular instance, the incorrect numbers in Form 5805 turn out to not be critical, but it seems sloppy and inaccurate and could lead to errors in calculating whether or not a penalty is due, especially if a person doesn't pay extra each period.
It appears that I can edit the Form 5805 in the Forms View. Should I do that for the sake of accuracy even though (in this case) it doesn't change anything regarding a penalty?
Is TurboTax aware of this issue and does it have any plans to fix it? I noticed the same thing happened with my 2020 TurboTax return (filed in Oct 2021) on these tables for annualizing income, but I didn't have a penalty from it and didn't have time to ask about it then. I had not needed to file Form 5805 before tax year 2020, so I don't know about any prior years.
I found a thread where someone else had inquired about this same issue back in April 2021 for tax year 2020, but no changes seem to have been made in Turbo Tax to fix the problem. https://ttlc.intuit.com/community/state-taxes/discussion/re-the-wrong-agi-is-shown-to-me-for-all-4-q...
I noticed other threads where people have said TurboTax incorrectly calculated overpayments or penalties due in their Form 5805 which CA's Franchise Tax Board then correctly re-calculated. Perhaps incorrect AGI entries in Form 5805 are why TurboTax provided wrong penalty information in those returns too. TurboTax needs to fix this Form 5805 issue by calculating all four CA AGI amounts correctly.
As a related, but more trivial issue….I noticed that in both my 2020 and 2021 returns, TurboTax generates a duplicate page in Federal Form 2210 for calculating annualized income. The page with the AI Method, Part I & Part II tables has a page with my numbers filled in, and then another identical page with the form but no personal numbers filled in. In 2020, it was page 4 of Form 2210. For 2021, it's page 3 of the same form. The extra page didn't seem to cause a problem for the IRS, but it's probably not helping anything either.
