Turbo Tax printed out the Form "other income statement" For the wrong year.

[Samosa]

I am preparing my NJ State taxes for the year 2021 (yes, late filer). I have W-2 as well as interest and dividend income. Additionally, I have $5k in "other income". On the ready-to-be-mailed final printouts, Turbo Tax has correctly listed my $5k "other income" on line 26 of the NJ-1040 for year 2021. Turbo also printed a form labelled "Other Income Statement" showing details for my $5k "other income". However, this "Other Income Statement" form is for year 2019, instead of year 2021. How do I fix this error and get this form for the correct tax year? Thanks for your help.

[SteamTrain]

First check the form to make sure it doesn't say "Do not file" on the top.

I know @maglib  and @rjs   used to do NJ tax returns, maybe they can check their 2021 software to see if it's a problem on theirs too, or whether a state software update is necessary and might fix it. 

[fanfare]

if you want to include that sheet just cross out the wrong year and write in the correct year.

It is only a cover sheet.

@Samosa 

[Samosa]

Thanks for your reply @SteamTrain . I double checked, it doesn't have this disclaimer. It definitely seems a form to be filed.

[Samosa]

@fanfare thanks. Doesn't look like a cover sheet. It is a proper form which provides a list of different sources of "other income" )such as prizes and rewards, income from deceased, scholarships, income from jury duty, reimbursement of deducted medical expenses, and so on...) and tax payer has to select one of these sources, or select "other" and describe it. 

I can manually over-write the correct year but not sure whether the State will reject the return because of manual edit.

[fanfare]

for some of those categories, an attachment is required.

That's why I call it a cover sheet.

You would have to file a paper return.

For 2021 you have to file a paper return, regardless.

does the form have a bar code?  If it doesn't have a bar code, should be no problem .

[SteamTrain]

@Samosa 

Barring the possibility that you have not run a software update...run one again just in case (that might correct the NJ form) I'd wait for either of the two folks I tagged above to see this and respond.  They probably both have the NJ 2021 desktop software, as they have used it in past years, and can see if they see the same problem.

Other than that, I doubt TTX will update the software for 2021 to correct it at this late date, but you'd have to talk to Customer Support to get a ticket written up in any case.   Could also white out the 2019 as a last resort, and write in 2021.

_____________________________

If you get the 2022 desktop software, check that form out right away  (but after 26 Jan...that is when the NJ 2022 forms are supposed to be finalized)....Report it to Customer Support if the 2019 shows up again...or any year but 2022, as they will certainly be actively adjusting bugs in the 2022 software, and would get it fixed for 2022 in a couple weeks.

[maglib]

@Samosa We filed in 2021 with other income electronically and so far so good.  Never realized it said 2019.  You are correct though.  Should be okay to file with it.  I did see if you update the software that turbotax fixed the mistake.

[rjs]

In the 2021 New Jersey software, when you look at the Other Income Statement in forms mode it has the correct year at the top, 2021. However, when you print it the printed (PDF) form has 2019 at the top. This happens with the software fully updated, so an update is not going to fix it. As SteamTrain said, TurboTax is not going to fix the 2021 software now. Since you are filing on paper, just cross out or white out the 2019 and write in 2021.

The 2022 New Jersey software shows the correct year in forms mode (as does the 2021 software). The New Jersey forms are not available for printing yet, so we cannot check the printed form. Check after January 26.

[Samosa]

Thanks @rjs and @maglib. One more question: Since our beloved NJ taxes any growth in HSA accounts, how to properly report dividends earned in my HSA?  The Form 1099-DIV issued by Fidelity doesn’t include dividends earned in my HSA account because they aren’t taxed by the IRS. Here's what I did;

After finishing Federal return I started the State return and Turbo transferred all the information from the federal return and walked me through step-by-step for filling out the state return. On the screen “dividend income”, all dividends reported on federal return were listed. I manually added HSA dividends by adding Payer’s name as “Dividends from HSA account at Fidelity” and "Net Dividend income” as “$500”.

On the final printout, the total amount of dividends (line 17) is $500 greater than shown on the Federal form meaning that Turbo correctly added HSA dividends. However, on Schedule B printed with the State packet, the amount of dividends shown is exactly as federal i.e., manually addedHSA dividends are not shown. I wonder why turbo tax is not showing manually entered dividends on Schedule B, and how to fix this issue. Thanks for your help.

[fanfare]

Schedule B is attached only if your interest is over $1,500 dollars.

It is not needed for dividend income.

[Samosa]

Yes, Schedule B Part I is for interest. I do have interest over $1500 so Turbo has correctly listed it on Part I.

I think Part II of Schedule B is for ordinary dividends. On Part II, Turbo has listed all dividends shown in 1099-DIV, but it didn't list manually added HSA dividends. 

[maglib]

@Samosa  The tax would only be upon withdrawal from the fund.  You are a cash basis taxpayer and do not have use of those funds till they are used for medical expenses or you take them out where they would be a 1099 for other purposes. The principal portion is tax free used for medical expenses  and you can utilize any fair allocation approach for the earnings as none has been specified.  Example if your basis is $100 and at withdrawal you had $250 of gains/interest/dividends.  Total value $350.  Let' say you had medical expenses of $50 that year and that is what you withdraw which for fed is non-taxable. For state though the cost basis is non-taxable and the rest is includable in income. You could choose to say all is non taxable till you hit your $100 basis or prorate the portion of income.  $50 X 250/350= earnings portion and even that portion may be deductible as medical expenses if you qualify (the cost basis would not be). 

So possibly, you would have no income to report. California on the other hand has opined.

Do not take this as tax advice. There is NO approved nor has NJ attempted yet to require 1099's on this income and they so far have given no written decision on how to report. 

It is an interesting decision and since there is no advice given, it is fair to take this approach. 

The dividends reportable should be reported as Other Non-Wage income.   After you complete the NJ return, go to adjustments, Other Non-Wage Income.  

[rjs]

@Samosa  See the answer from a TurboTax expert last year at the following link.

How do I report HSA interest, dividends, and capital gains on the New Jersey Return?

The Schedule B that is attached to your New Jersey tax return is a copy of the federal Schedule B. It is not a separate New Jersey form. New Jersey requires a copy of the federal form.

[rjs]

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@Samosa wrote:

Turbo also printed a form labelled "Other Income Statement" showing details for my $5k "other income". However, this "Other Income Statement" form is for year 2019, instead of year 2021. How do I fix this error and get this form for the correct tax year?

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@Samosa  The Other Income Statement has been corrected in today's update (Jan. 26,2023). The Other Income Statement now has the correct year at the top in the PDF.