Why don't we qualify in 2020for an Ohio joint filing tax credit when our income and taxes owed are very similar to 2019 when we did, with similar income and taxes paid?

Per the State of Ohio, you can take this credit only if each spouse has qualifying Ohio Adjusted Gross income of $500 or more.

Qualifying Ohio Adjusted Gross Income

• Does not include income from Social Security benefits, most railroad retirement benefits, uniformed services retirement income, interest, dividend and capital gain distributions, royalties, rents, capital gains, and state or local income tax refunds. This credit is limited to a maximum of $650.

Example: Bob and Sue file a joint return. Sue earned $200,000 from her current employment. Bob’s only source of income is $500 from his state and municipal income tax refunds included in Federal Adjusted Gross Income. This $500 should be deducted as a Schedule A deduction and is not included in Bob and Sue’s Ohio Adjusted Gross Income. Therefore, they do not qualify for Ohio’s joint filing credit.

Be sure you assigned your income items (such as W-2 forms) to the correct person.

I have the problem that Turbo tax is GIVING me the Ohio joint filing credit, yet, my wife earned no income in Ohio. I reviewed my federal return and indeed no income was assigned from Ohio. She did have unemployment compensation from New York that was identified as New York

So, how do I override that error I am describing? I want to remove the credit, yet there appears to be no way to do that.

Larry

To clarify-

Was your wife a resident of Ohio or New York when she received unemployment? 

If she was a resident of Ohio, the unemployment (paid by any state) would be claimed and taxed by Ohio. 

That may be the reason you are getting the credit, and if that is the case, you also need to pay the state tax on that unemployment income. 

If she was a New York Resident, the unemployment would be claimed, and taxes paid, to New York. 

Thanks for clarifying questions...

My wife lives in NY full year

and her unemployment was received from the state of NY

$0 income in Ohio for her.

Please reply

Larry

It depends. Filing jointly in Ohio (OH) you can get the joint filing credit ONLY if each of you have at least $500 in OH adjusted gross income. If your wife has no income in OH, then this credit is not allowed.

•  To qualify for this credit, you and your spouse must each have qualifying Ohio Adjusted Gross Income of at least $500 after you have figured your Ohio Schedule A adjustments. 

You can file jointly in OH, even if your wife has no OH income. 

Your wife must also file the New York (NY) return as resident and pay tax on her income in her resident state.  None of her income should be taxed to OH, only NY.

Review the step-by-step process in the OH state return to be sure you answer all the questions correctly and to remove your wife's income. Also be sure from the federal section that the income is appropriately assigned to the correct spouse.

I appreciate the answer 

But, I did and reviewed all that

And looking at Ohio forms view it assigned the NY unemployment income as ohio income for some reason on the ohio state return forms. 

My wife does her own NY state return and of course will pay the due NY tax requirements. 

There seems to be a problem with the TT program itself.

The unemployment income was assigned as from the NY labor department when entered in the federal step by step. 

My spouse has no ohio income at all.  

And the Ohio state step by step process is not providing any Ohio income step by steps or income allocation steps. The TT program is pulling all income from the Federal step by step

There are no questions to answer in TT Ohio State 

Where are these allocation questions you state in your reply?

Thank you 

Please advise. 

Larry

I understand the situation.  It would be helpful to have a TurboTax ".tax2021" file that is experiencing this issue.

You can send us a “diagnostic” file that has your “numbers” but not your personal information.  If you would like to do this, here are the instructions: 

Go to the black panel on the left side of your program and select Tax Tools. 

1. Then select Tools below Tax Tools. 
2. A window will pop up which says Tools Center.  
3. On this screen, select Share my file with Agent. 
4. You will see a message explaining what the diagnostic copy is.  Click okay through this screen and then you will get a Token number. 
5. Reply to this thread with your Token number. This will allow us to open a copy of your return without seeing any personal information.  

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution. 

@lvrager

[Edited: 03/16/2022 | 7:49a PST]

This is answered at poster's other post https://ttlc.intuit.com/community/state-taxes/discussion/turbo-tax-state-return-for-ohio-is-in-error-giving-us-a-joint-filing-credit-appears-to-be-no-way-to/01/2583911#M121843

TT is doing it correctly.  There is nothing to fix.

Ohio's method of tax calculation, for non-resident's is convoluted, and hard to understand and/or explain.  Ohio first calculates what the tax on all your income  would be, applying all deductions and credits, including the  Joint Filing Credit (JFC).  So, the JFC is only used to  reduce  the  tax calculated on all the income ("Ohio Adjusted Gross Income", which includes the NY income). Then it applies the separate non-resident credit, to effectively tax only the OH income.  

Thank you for your offer, Diane 

I have generated and sent a diagnostic copy

My token number is 958877

Look forward to your suggestions.

Larry

Diane,

When can I expect a reply concerning my TT issue?

Again, looking at the Ohio Joint allocation worksheet, TT is putting my spouses NY unemployment as Ohio income, which is wrong

And there is no screen to reallocate what it transferred from the Federal return.

The Unemployment income was clearly marked as NY dept of labor income via the appropriate pull down in the federal TT screen

Thank you,

Larry

@DianeW777  See poster's comment  & token #. 

The joint filing credit is not wrong and the information provided by our awesome Tax Champ @Hal_Al about that is correct.  Ohio (OH) is going to factor that based on all income on the tax return because it starts with federal adjusted gross income (AGI).

Here is what you need to do to apportion the tax correctly for the OH income using TurboTax CD/Download version. If you need to switch see the instructions in the link below.

• How do I switch from TurboTax Online to TurboTax CD/Download?

1. The Schedule of Adjustments is correct removing the state tax refund and the social security benefits.
2. Form IT NRC (Nonresident Credit) needs to be included by using the override to do two things.  You may need to add this form using 'Open Form' at the top.
   1. Enter the Nonbusiness capital gain income in column (B)  (right click and select override)
   2. Scroll down to Line 14 to enter a description (UC NY) then enter the amount on Line 15 (right click and select override)
3. This will properly apportion the nonresident portion of OH AGI.
4. The tax will reflect the appropriate amount due to OH
5. See the images below for assistance.

This was the only way I was able to get the necessary results for your return.  Under normal circumstances, you shouldn't have to override anything. Returns that contain overrides cannot be e-filed and may not be covered under our 100% Accurate Calculation Guarantee. We're providing these instructions to customers who understand the risks, but wish to proceed anyhow. 

We are looking into this experience, however you should continue to complete your return at this time.

@lvrager

[Edited: 03/23/2022 | 7:06a PST]

I appreciate the effort to analyze my return

Though, I do not understand why Part B of the Ohio NRC form would be edited. At no time was my spouce a part time resident of Ohio. (full time NY)?

Also, I do not understand where the override number you suggest I enter in Part B is generated from.

And why do I need to override - and lose my TT support - When I entered everthing correctly on the federal form?

Again,

I appreciate the time

Larry

The capital gain is taxable to OH in my scenario.  I was unable to tell if it was jointly owned and assumed it was the taxpayers. As such it was not being counted as taxable for OH so this is the first edit to include it in the OH Amount column.

The second override (Part B) is the unemployment compensation that should not be taxed to OH (only NY) and has been entered as a deduction to reduce the OH income before calculating the percentage of income that should be taxed in OH.  

This reflects an accurate tax rate for the income that should be taxed to OH.  I hope this explains the nature of the suggested overrides.  I suggest printing and mailing the OH return.

@Ivrager

No overrides should be needed.  If the unemployment is identified as the spouse's income and the spouse is identified as a non-resident, all her income will be non Ohio income for the non-resident credit.

It may only show (with her other income) in part C of IT NRC and on line 30 of the Schedule of Credits.

Let's examine your addition of capital gains please...

On the bottom of the Joint allocation work sheet it is stated that capital gains are not part of Ohio qualifying adjusted gross income.

Please comment why included then.

Larry

Capital gains are not part of  qualifying Ohio adjusted gross income, for purposes of  qualifying for the Joint Filing Credit (JFC). 

Capital Gains are part of  Ohio adjusted gross income, for purposes of allocating income as Ohio or non Ohio income, for the Non resident tax credit.  If the gain is jointly owned by both spouses (as it usually is) then your half  is allocated as Ohio income on IT NRC but not on the JFC worksheet.

Your situation is very rare. But, the Ohio forms and TurboTax program are able to handle it, just not very transparently. 

Hal_Al

Thanks for your expertise

The Capital Gains is my own (not joint)

Does that change your last reply?

PS

I see that latest TT update is asking me to override the IT NRC form by allocating the Capital Gains as Ohio income - therefore increasing my Ohio tax liability

In the federal interview, you are asked to identify who the income (capital gains in this case) belongs to.   Even if you make a mistake there, the Ohio interview should allow you to change it.  You will be asked how much of the capital gain is OH income.  Enter 0.  If the box is prepopulated, change it to 0.