2021 Form 1116 Schedule B (carryovers) can't efile

[joergherrmann9]

Your approach worked for me as well. I am using a Mac, so a few steps look different from the ones described in your instructions, but the strategy is the same.

Thanks for your help, much appreciated!

[BJDCPA]

I appreciate your update. In reviewing the IRS website for approved e-filing forms Schedule B to form 1116 was not approved by the IRS per their website but form 1116 was approved. I believe this explains the 3-17 date for paper filing but not supported for e-filing.  Per your message appears Turbo Tax is programming to have a PDF of Schedule B as an attachment. It is my understanding in the past Turbo Tax did not allow PDF's to be attached for e-filing.  This would be a departure and a good one if this comes through.  The IRS is the problem for not approving the Schedule B for e-fling.  I would think other software which allows e-fling of Schedule B allow for PDF attachments.  My two cents.  

[TrishMarie]

I still have a question for a PC, not Mac.  How can I get back to the screen that asks you if you want to have a "carry over" credit?  I tried deleting the Div statement and then re-entering all the information, but the question about the "carry over" never shows up again.  I tried the back button, that didn't work.  Tried shutting down TT and starting it again that didn't work.  If I choose not to "carry over" the credit this year, I wouldn't need the Form 1116 Schedule B.  Any help with how to get that question back?  I did ask the office of the president, but they seemed to ignore that portion of my question.

If they can fix this by March 17 so we can e-file with a PDF that's great, I don't really want to wait until March 31. 

[DumTra]

I'm still getting this error message now and it is past March 3. I never got this message in the past. Why am I getting it now?

[greatestmom24]

Agreed - Turbo Tax needs to fix the form - we all want to E File

[aghess]

The only thing I can think of related to your question would be if you want to take the deduction or credit. If you chose the credit, there would be no carry over. You get that question at Federal Tax/ Deductions & Credits/ Estimates and Other Taxes/ Foreign Taxes. There it will ask you if you want the Deduction or Credit.

Depending on your situation, if you select the "Deduction" and end up taking the standard deduction you will lose the benefit of the foreign tax credit. If you are fortunate enough to have enough deductions to be able to itemize deductions, selecting the "Deduction" vs the "Credit" will probably give you the most favorable result.

If you are using the standard deduction however, you should select the "Credit" and will need to deal with this TT form issue. It is likely that you will never be able to use this carryover unless you plan to actually work in a foreign location. One way to get the credit and be able to E-file would be to go to the error and move the carryover amounts to the denied column for both the normal return and the AMT calculation that is just below it on the form.  Then you could always file an amended return later if you chose but no numbers will change on the actual return since they were all correct anyway.

[KimT-IL]

jtrevor

Level 3

yesterday

That question has been answered 30+ times in this thread.

jtrevor ... you are TOTALLY cracking me up!  It is so obvious to me that you are clearly just as ANNOYED as I am at these people asking the SAME question repeatedly .. and they have CLEARLY not read the thread.  Thank you for providing me a good "chuckle" while I research this aggravating situation (and by that I mean - read through the ENTIRE thread looking for an answer before I post the SAME question - LOL

[bogalur_native]

@Anonymous 

Congratulations. Your logic is sound and it is quite reasonable to me. Some of my thoughts are as follows:

1. The IRS has accepted your return and this is good.

2. Just in case, if your return gets audited, it would detect absence of Form 1116, Schedule B, a requirement beginning 2021 filings.

3. If a human checks it, she/he would see the F1116 C/O sheet and if it is a simple "passive income" category, it is essentially the same info as it would be documented in the Form1116, Schedule B and hence it is a done deal.

4. Not all IRS auditors make sense and you may get a letter. If so, produce the carryover sheet from your 2021 return, maybe a filled Form 1116, Schedule B (same info again) with a cover letter at that time. 

I must admit you are a very smart person and enjoy the left over Sunday. What made you think your method might work? "Attempt a override, cut & but do nothing" - really smart moves !!

[bogalur_native]

@Anonymous 

I tried your trick. It works but it looks to me the F1116 C/O is not applied because my refund amount changed now. 

Note your portion of the posting:

-------------------------------

Now the fix...

a) Right click that number.  A pop-up will appear.  Select "Override"

b) Then, in the same pop-up select "Cut". 

Important - After "Cut", don't enter any value in that box.

Another blogger suggested you replace the original number with the "0".  Don't do it!  It doesn't work.  With any value in that box (even 0), TT will force you to fill 1116 Schedule B by mail on 3/31.

---------------------------------

Once you select "Override", I cannot select "Cut" immediately; I need to do a smart check again? Please elaborate. Thank you.

[surbas]

So March 3rd has come and gone. Any idea when efiling in thi scenario will be available?

[Anonymous]

@bogalur_native 

Logic I used was …

1) The error in Form 1116 was the carryover amounts.

2) I don’t HAVE TO take Foreign Tax credit for past carryovers this year - IRS allows me to roll them forward for 10 years.  So why not get this year’s filing done?  In any case, I will get credit for Foreign Tax Paid in 2021 in this year’s filing!

3) I reset the total carryover from the past to $0.  Went through filing, and still saw the error.  I guessed that showing any value in that box will create an issue.  What if I just left the field blank?

4) Used “Cut” and tried again.  It went through to the e-File page.

5) Checked the pdf before filing to see what the IRS may see.  Saw 2 things …

(a) TT had re-calculated the total carryover cell and had included all my incoming rollovers in the doc that was being transmitted to the IRS.

(b) Also reviewed Form 116 which showed I was using this year’s Foreign Tax Paid as a tax credit but not using past carryovers. So the IRS would know that I had incoming rollovers but didn’t use them this year.

6) This then became a no-brainer for me.  The choice was to

(a) Wait till 3/31 to file using past carryovers for a credit this year (maybe even on 3/31 TT would force me to file by snail mail which I really don’t want to do), or

(b) e-file today and roll-over past carryover credits to next year when Form 1116 Sch B will hopefully be available for electronic filing?

That was a no-brainer in my instance since the past carryovers were not too high.  I really needed to get my taxes done and really hated the idea of paper filing.

And pushing prior carryovers to next year didn’t feel too much of a compromise.

I realize not everyone will have the same calculus.  As someone posted, their past carryovers were $500 and they didn’t want to push those over to next year.  In that situation it likely made sense for them to wait to 3/31 and use Form 1116 Sch B to get the credit this year.  In my case, the past carryovers that I could’ve used this year were lower, and I felt ok about pushing them to next year.

I hope sharing my thought process (as well as the counter approach taken by others) helps readers decide what’s best for their situation.

[Anonymous]

@bogalur_native

After clicking “over-ride” you may have to select the value in that cell and right-click again to have the menu re-appear.  Once it re-appears you should be able to select “cut”.

I didn’t have to “run smarkcheck” again before being able to Cut.

[bogalur_native]

@Anonymous 

Thank you. In my case, it does matter in terms of the refund amount; either I wait for a full refund or take a lesser amount of refund for the 2021 filing. I agree with your logic. In my opinion, it simply amounts not using the F1116 C/O data. What you demonstrate is that the F1116 C/O data remain as part of the e-filing though the net gain becomes ineffective for some tax filers. Is my inference accurate? 

[cwkhsk]

Me, too! If I can not efile due to TT, I will not use TT in the future.  I have only used TT but it has been gradually getting worse, not better.  

[AKCO]

0. The official status as of 3/6 is that Form 1116 Sch B is unsupported for E-file:
https://care-cdn.prodsupportsite.a.intuit.com/forms-availability/turbotax_fed_online_individual.html

1. However, if you can wait, multiple people have received a response from officeofthepresident stating that Intuit is working to allow E-file by attaching Form 1116 Schedule B as a PDF file.

2. (If you cannot wait) If you have no carryover from a prior year (2020 or earlier), some have suggested overriding carryover from this year (2021) to zero. However, it would seem one would then forfeit the carryover. I am not sure if this is what an amendment is intended for, but would a better solution be to change foreign tax paid (line 7) on 1099-DIV to the allowed foreign tax credit amount, file (again, this is if you cannot wait), then when Schedule B is available correct line 7 on 1099-DIV and amend the tax return?

3. Gary GG suggested looking into lowering line 18. Unfortunately, like krsbozo it did not work for me for 2021.
https://ttlc.intuit.com/community/tax-credits-deductions/discussion/re-2021-form-1116-schedule-b-car...
https://ttlc.intuit.com/community/tax-credits-deductions/discussion/re-2021-form-1116-schedule-b-car...
https://ttlc.intuit.com/community/tax-credits-deductions/discussion/re-2021-form-1116-schedule-b-car...

According to page 21 of the Form 1116 Instructions, because I did not adjust lines 1a and 5, I must not complete the Worksheet for Line 18.
https://www.irs.gov/pub/irs-pdf/i1116.pdf

In the "Adjustment exception" paragraph:
make election = not completing the Worksheet for Line 18.
Must make election, so must not complete worksheet, if chose not to adjust lines 1a and 5.
Cannot make election, so cannot not complete worksheet, if made adjustments to lines 1a and 5.

4. TurboTax is calculating line 3eA correctly.  I had failed to notice this from Form 1116 Instructions: "Lines 3d and 3e

For lines 3d and 3e, gross income means the total of your gross receipts (reduced by cost of goods sold), total capital and ordinary gains (before subtracting any losses), and all other income (before subtracting any deductions)."