I am a nonresident of VT who sold real estate in 2023 (at a loss) and received a Form RW-171 for the mandatory 2.5% real estate withholding. Given my tax situation, I should receive all of that withholding back in the form of a refund when I file my taxes.
However, in going through the Turbotax prompts for my VT return, when I get to the step where I should enter the RW-171 amount, Turbotax incorrectly instructs me to first add that amount to my Federal return as an estimated tax payment. This is wrong. But if I follow along and I do that, and I then also report the RW-171 amount on VT Form IN-111 as I'm supposed to do, Turbotax then double counts the withholding and tells me that I will get twice the refund! While that would be nice, it's clearly wrong. This is because Turbotax is putting that RW-171 amount onto both Lines 25b and 25d of Form IN-111's "taxes paid" calculation. Per VT state's own instructions for Form IN-111, it should only be going on Line 25d.
The second problem is that, for VT nonresidents who did not have any income tax withheld by VT, but who did have mandatory real estate withholding on Form RW-171 because they sold a property, Turbotax kicks back the return with an error message saying "real estate withholding should not be greater than the total Vermont income tax withheld". This is simply not correct, as my case clearly shows.
I tried to chat with someone using the Live Chat feature, but she wasn't able to help me.
Would someone within Turbotax's technical team please take a closer look at this?
If these calculation errors persist, I won't be able to use Turbotax to file this state return, and it will make me seriously question the accuracy of any of the other 8 state returns I also need to file (my husband travels a lot for work).
