Frustrations with Turbo Tax... ACA and 529

[emsolari02]

This may be it for me and TurboTax. I just don't get it. Sure, I know software is hard but Intuit is supposed to be an expert at this. At least, that's how they've advertised themselves over the years.

Regarding 529s, TurboTax still hasn't fixed the well-known issue regarding asking about a 1099-Q (which everyone that withdraws from a 529 will have) then assuming all the withdrawals are non-qualified if user doesn't explicitly list all expenses. If all expenses are qualified, letting TurboTax (and the IRS) know about the 1099-Q is entirely optional. Somewhere in the interview process the software should ask "And did you have any non-qualified withdrawals?". If yes, then make certain the person lists expenses. If the answer is "no" then ignore the 1099-Q and move on. This has been an issue for years and the fix to preventing folks from messing up is very simple (ask a follow-up question!!).

Regarding ACA, the software asks if there are dependents filling tax returns and, if so, how much they earned. This is because MAGI includes everyone in the household. The issue is that dependent's earnings are only applicable if the earnings are over the IRS threshold. I didn't know this and entered all their incomes only to see my ACA credit evaporate. Some additional research (thanks ChatGPT and IRS site) indicated that, no, they are not over the thresholds therefore you don't need to enter this information. Why doesn't TurboTax inform the user - especially since income thresholds and the "cliff" are so notable lately? It makes no sense. The software just assumes that if Joey and Sally are filing, then they must be over the limits. That is a poor assumption. My kid's are filing returns because somewhere along the way an employer did a withholding and they want their $20 (or whatever) back.

Anyway, lack of attention to detail on these very common scenarios makes me wonder what else is wrong that I'm not seeing. The 529 issue has caused me to have to re-work 2024 taxes and the amended return is still sitting with the IRS. It's been 6 months...

[AmyC]

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