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

[fa123]

@DaveF1006 @MishawakaKirk @JES33 @Sonnyof42 @mesquitebean @turbokarst @PGH @MarilynG1 @GeorgeM777

Update:  I managed to e-file my returns and 20 minutes later, they were accepted by the IRS and the state of California, thanks to the helpful comments and suggestions by some of the normal fellow victims/users on this forum.  (And no thanks to the useless, clueless, aggravating TT tech support people, 8 out of 9 of whom that wasted more than 10 hours of my time over 4 days in a span of two weeks, lacked even common sense, let alone technical knowledge.)

I use the downloaded Delux version of TT on Windows 11.

My case: although my returns had no error, warning, or issue according to the TT program, which would allow me to E-file, my E-file and transmission of my return to the IRS would succeed, but some days later, my return would get rejected by the IRS, because of an issue with the calculation of the carryover of foreign taxes on Form 1116 Schedule B Carryover Foreign Taxes.  I would then receive an email from TT instructing me to check the status of my E-file so that it would fetch the IRS feedback and guide me through fixing the issue flagged by the IRS.  All numbers on this form were pulled from my last year return and all calculations were made automatically by the TT program.  I had not done any manual entry, not done any bypass tricks, nor had overridden anything in my return.  However, my TT program would not fetch the IRS feedback, because in spite of having E-file my return and getting it rejected twice by the IRS, it still claimed that I had not E-filed my return!

The problem: clearly the TT program has two distinct bugs: (1) it had messed up the foreign tax carryover calculation, because the IRS disagreed with what it had produced and verified as perfectly correct; and (2) it still thinks that I have not E-filed my federal and state taxes yet.Current status: following the advice of the users on this forum, I changed my foreign tax option from credit to deduction, followed through to the end, then returned back and changed the option back to credit.  I E-filed and in 20 minutes my returns were accepted. 

So, I succeeded to work around the first bug this way.But, the second bug still persists (why wouldn't it, no one has even acknowledged it as a bug, let alone do something about it, like heaven forbid, fix it?).  My TT program still claims that I have not E-filed my return!  Interestingly, when I close my return, it warns me that I have paid the $25 fee to E-file my state return, and should not forget to E-file my returns! 

TT refuses to acknowledge that it is a bug when their program claims that I have not E-filed (and so still have the state E-file fee credit), even after my E-file has been accepted by the IRS and the state of California. (The 9th "genius" that I talked to at TT insisted that this was not a bug, the program had no issue, because it only sometimes was unable to fetch the status of a return.  She was so busy barking contradictions to whatever I said, that she could not understand her sentence was the very definition of what a bug is!) 

Therefore, I can now go ahead and E-file as many returns as I wish!  The program never realizes that I have E-filed, and still thinks I have not used my $25 state E-file fee.

My plan now is to make my PC available for rent, so that potential TT users can pay me only $5 per person to do their taxes and E-file (federal and CA) using the unlimited E-file "feature" of my TT program.  Imagine, if I get only 2000 such users, then I deprive TT from 2000 x $85 = $170,000, while I receive $10000, the whole sum of which I will happily donate to a charity.  Granted, this devious plan is not practical, but perhaps the potential threat of making a dent in their income if enough users attempt this scheme, each at a smaller scale, will eventually grab the attention of TT and persuade them to fix this bug. 

News flash: Hey, TT, when your program successfully E-files a return, regardless of whether or not the return is accepted, the program should NOT claim that the user has not E-filed; it should fetch and display the correct status of the E-filed return (e.g., submitted, accepted, rejected, etc.).  When you send an email that instructs the user to click on Check E-file status to see the issue that has been flagged by the IRS, and guide the user to fix it, your program should do just that; it is a bug if it still claims that the user has not E-filed!

Look, we get it, US tax laws are complex by design; heck you (TT) spend a fortune lobbying to keep and make tax laws ever more complex.  It is then inevitable that your software products have bugs, especially when new tax forms and regulations get introduced.  We can live with, tolerate, or work around the bugs, if you acknowledge issues promptly, communicate proper information to users and your tech support, take user complaints and bug reports seriously, and spend a little bit of the fortune that you spend on lobbying to hire competent tech support people.

[JES33]

@fa123 Part of the problem is that most of the people you talk to at TT are not experts and not at all technical. Not to minimize the role they play, but they are customer service reps and should trained to know their limits and when to escalate issues. It is also obvious that there is an extreme lack of communication within TT. In any event, I’m glad you were finally able to file. Thanks for the update and to all who participated in this forum. 

[Anonymous]

@fa123 

So you are now in the same step as I am .

efile accepted but tt still shows not efiled..

I am just waiting for irs to process it (21 days wait but some earlier ) i the irs refund web site .

Crossing my fingers that  I will get my refund in 21days ( not rejected) anyway olt is just a click away if I get irs issue 

[turbokarst]

I'd read back about 15 pages and use the technique to create a pdf of only Sched B and then create folder under "c" drive and try again.  It is pretty well documented.. you just have to look about 15 pages back in this long thread.  Follow exactly including file name.

[fgsherrillt]

TT made a fix on March 11 for the online version, and that fixed all my problems with the schedule B issue for the foreign tax credit carryover.  My suggestion is to always use the online version in the future as it is much simpler for TT to make updates to it.

[thohogan]

amen to this answer. This is a really basic flaw to the program to not know where to locate a document. 

[SCswede]

All good questions which I agree you would think should be included. My TT source, who I think really understands the IRS rules, the definition of gross proceeds in this case is taxable proceeds. Thus, capital losses are added back in, a substantial effort I might add, but not non-taxable portion of social security benefits, non taxable state refunds, tax exempt interest and dividends, etc. Can't speak to all possible items as I'm far from a tax expert and relied on my TT source's input which allowed me to reconcile the difference between my AGI and line 3e on 1116 within $1 or so by adding back just my ST and LT capital losses. In this situation, I hope TT mirrors the IRS definition of Gross Proceeds for purposes of this calculation. TT would be wise to develop an actual worksheet for this reconciliation of the difference.

[Debbie412]

thorvost

are you still not able to e-file?  I waited until after the TT update on the 18th (waited until the 20th to make absolutely sure it was there), and was able to successfully e-file.  As many have mentioned, I had to change the foreign tax selection to a deduction then back to a credit.  I believe this recreates form 1116 and schedule b correctly due to the updated software.  (Details about how to do this are further back in the thread).  I did NOT have to create a PDF of form 1116 Sch. B.  TT had fixed that portion of the problem by then also.  Please try this and let us know.

Thanks for everybody's input and solutions!!  Thanks to you, I am done for the year.  

[thorvost]

@Debbie412 

Since I had done the cumbersome credit/deduction/credit loop before without success, I wanted to wait for an update after 3/31 because this is the date I was told by TT customer service by which the bug would be fixed. So now I have version 021.000.559 of TT Home & Business, and I did the following:

- Chose itemized deduction in the foreign tax section, noted the effect on my refund

- Saved the return

- Went back to the foreign tax section, chose credit and re-entered all the relevant information about the foreign tax payments, related income and deductions, as well as the carry-over information

- Tried again to file, with the same result as all the other times:  "We can't efile your return because we are unable to locate the attachment at / attachment/Form1116ScheduleB.pdf. Please go back and re-attach it. Then try efiling again."

In short, TurboTax has not fixed this problem, and I have no idea how I am going to file my return. I find it unbelievable that the company would leave their customers in such a lurch without even the effort of posting an explanation in this forum.

[mitchwinter]

@Debbie412. .. try this.  And I hope you have windows.  Print only form 116 schedule b and save it as a pdf in a directory c:/attachment/Form1116ScheduleB.pdf.  . Try to effort again.  Let me know. 

[thorvost]

@mitchwinter  Thanks a lot for your help! It worked! Or at least it unblocked the e-file stage, and the return is on its way. I will report back once the return is accepted or refused.

[thorvost]

Update: My federal return was accepted by the IRS! Once again thanks to @mitchwinter !

[Barryj1]

Thanks for your post.  It worked for me!  When TT wouldn't e-file form 1116, schedule B, I turned to these posts.  And your post was the one that worked for me.

My only problem was that I was skeptical at first that saving the form 1116, schedule B PDF to the root directory (c: drive) would work.  (After all, why would the TT program know to look for it there?)  But it did, once I figured out how to do that!  So, thanks again.

[Barryj1]

For clarification, my post from a couple of minutes ago was in reply to debbie412.

[Barryj1]

I'm sorry all.  My earlier reply was to mitchwinter who was replying to debbie412.😅