Why is CA 540NR L83 not recognized? Why is CA 540NR expecting L81 to not be zero?

[kent2]

TurboTax is incorrectly ignoring CA 540NR Line 83 (Form 592-B).

I had to 'trick' TurboTax by moving the withholding amount to CA540NR Line 81 California Income Tax withholding.  This is technically wrong...since no W-2 nor 1099 was issued.

[TerryA · Accepted solution]

It's important to enter the Calif Form 592-B information correctly:

Enter the Calif tax on Form 592-B in the federal return first:

Federal Taxes tab
Deductions and Credits
I'll choose what I work on
Scroll down to Estimates and Other Taxes Paid
Select Other Income Taxes
Under Other Income Taxes Paid in 2018 is
Withholding not already entered on a W-2 or 1099  <Start>
Enter the $$ withheld in the State box (round to nearest dollar - don't enter pennies) and select California from the dropdown

In TT/Calif click through until you get to the screen Take a look at California credits and taxes, under Payments and withholding select Real Estate and Other Withholding. Check the 592-B Box and you will be shown an image of the form to input the data for electronic filing. This will "sync up" the "other withholding" coming from the federal return and treat it properly on the Calif return.

[kent2]

Thank you.  I see how this achieves the desired end result.  However, the withholding was through an S Corporation.  California FTB indicated the withholding should be reflected on the Federal K-1, Line 12 code = S. In either case, an additional conversation with CA FTB will be required to complete the process.

[TerryA]

Oh, then no adjustment is necessary in Calif - state withholding entered on the federal 1120S K-1 will automatically go to the right place. If you enter the CA withholding there then things work normally. Do NOT enter the K-1 CA withholding as "Other withholding not on a W-1 or 1099" - that's when things get complicated. If you did that, remove it.

Enter the CA withholding $$ in Box 12  Code S (this is a lot faster in Forms Mode), click the QuickZoom to enter the details for Code S, and in the "Code S" section, line 3 (State income tax withheld), enter "CA" and the $$. You're done.

[kent2]

Agreed. That was my original approach...and TT indicated no errors. However, after electronically submitting, the return was rejected indicating '540NR L81 could not be zero'. So, I zeroed out L83, reentered to L81; resubmitted; and return was accepted:)

[mryflyguy]

I'm a AZ resident in a similar situation but need to file a 540NR to recover some state tax withheld in escrow (form 593-V) for the sale of our second home (we already pay capital gain on the income in AZ). We have NO earned income in CA thus NO W2s to report. I tried filing electronically in TurboTax but it was generating the exact same errors - plus a erroneous filing status error (?).

F540NR-670 - There is an error on Form 540NR, Line 81 (CA Withholding). Line 81 (CA Withholding) must equal the total amounts withheld on all W-2, W-2G,1099-R forms and Other Withholding (Other Withholding) Amounts (Amount) where: On Form W-2 'CA' is present in Line 15, Withholding Amount Checked: Line 17, (State Income Tax Amt ). On Form W-2G 'CA' is present in Line 13 Withholding Amount Checked: Line 15, (State Tax Withheld Amt). On Form 1099-R 'CA' is present in Line 13, Withholding Amount Checked: Line 12, (State Tax Withheld Amt). Exception: The Filing Status (FilerStatus) is equal to Married/RDP Filing Separately.

I opened a case with TT, sent them my file and they said the routing number in the return was incorrect. No, it was fine. I edited it, refiled it in TT just for kicks, e-filed again with the same error. Finally, I modified the refund option to just sent me a friggin' check, refiled it, e-filed again and it generated same error so TT is just FUBAR in this situation.

At this point, I requested a refund on the CA e-file charge and am going to mail them the return. Working thru TT, indicating I want to "print to mail", TT prints all returns - FED, AZ and CA. Do I really need to send CA all tf the IRS & AZ forms?  

What a mess...

[TerryA]

Actually, since the property is located in Calif, Calif gets to tax any gain you may have had on the sale - that's why Calif tax was withheld on the sale in the first place. And AZ gets to tax it as well because your are a resident there.

To prevent double taxation, your Calif nonresident return will prepare a credit for the portion of the AZ tax attributable to that gain. (this is the opposite of the normal process of the Other State Tax credit is claimed on the resident state's return. residents of AZ, OR & VA do it this way.)

After completing your TT AZ return, run through the TT nonresident Calif return and look for the opportunity to prepare the Other State Tax Credit.

Enter the Calif tax withheld on the Form 593 as described (way) above to get it into the Calif return properly.

[mryflyguy]

I have no earned income in CA so no W2 for CA. Form 540NR, Line 81 actually SHOULD be aero but TT will not allow it. I opened a case and was told this is a defect in TT. Since I paid Intuit to file CA electronically, I got a refund for CA filing and was told to just print and mail the CA return. 

If you're getting this "Form 540NR, Line 81" Error that says it can't be zero, don't bother trying to file electronically, it won't work. Just mail it in.      

[TerryA]

The program works correctly for this situation - when Forms 592-B and/or 593 are entered correctly (as described) then those withheld $$ will land in Form 540NR line 83 and there will be no complaints about line 81.

[hocoseba]

TerryA. You are incorrect. When form 593 is entered in TurboTax, it incorrectly enters the tax filer's name and SSN in the Remitter Name and SSN fields on page 2. These fields are not editable and MUST be the actual remitter's name and FEIN (or ITIN, etc. as applicable).