Home office deduction is being disallowed

[caschevon]

Home office deduction is being disallowed because Turbotax says profit is zero, except it's not (it's 4 figures).   I have gone through the menu items repeatedly and updated Turbotax, but it hasn't changed. 

I manually edited the form to include the  deduction, but now I find that is preventing me from e-filing my tax return.   Help!!!!!   There seems to be no way to make that deduction acceptable to Turbotax.   I answered all menu items correctly.   Using the desktop version (Premier) on Mac OS.

[AnnetteB6]

It is possible that there is a missing piece of information preventing the home office calculation from being correct.   The percentage of income attributed to business use of the home may not have transferred correctly, even if you did indicate that you do all of your business in your home office.  

To fix this situation on your return, the number may be entered directly on the form using Forms mode.  Use these steps:

1. Click Forms at the top of the TurboTax screen.
2. Click Form 8829 under your Schedule C in the left panel of the screen.
3. Scroll down to Part II and look for the Line 8 Calculation Smart Worksheet.
4. Enter your percentage for business conducted in the home office on Line B.

The situation described above is being reported to the development team for further investigation and correction.  If this did not correct your situation, consider sharing a diagnostic copy of your tax data file so that we can take a closer look to try to help.  The diagnostic file will not contain personally identifiable information, only numbers related to your tax forms.  

To provide us with the diagnostic file, follow the instructions below and post the token number in a follow-up thread.

Since you are using a Mac version of TurboTax, use these steps:

• Go to the Menu at the top of the screen and select Help.
• Then, Send Tax File to Agent.
• Post the token number here.

[caschevon]

Editing forms unfortunately will prevent the return from being e-filed.   I had already tried that.

I simply entered the deduction under "other business expenses" with description as home office simplified deduction and the square footage.   If I get audited I'll just explain that Turbotax was unable to handle this deduction.  

I look forward to this being fixed for next year.   Alternatively, please consider allowing e-filing of returns with edited forms, since that is often the only way to fix Turbotax errors such as this.

[AnnetteB6]

You are allowed to enter a number directly on a form using TurboTax, such as suggested in the instructions I provided above.  This does not prevent electronic filing of your tax return.  

But, if you override a number or a value that was calculated by the program or brought to a form from another input area, that will invalidate the guarantee and prevent electronic filing.

@caschevon 

[user17735820217]

Are you saying you can completely skip all the menus and simply edit the forms directly, without losing the ability to e-file?

That was not my experience, but maybe there was a lingering effect from when I first tried to enter the home office deduction.   The same thing happened in another menu on the state return, and I ended up having to give up a $70 tax break that I would have easily gotten by filling out the form manually.    Unfortunately in that case the form was automatically activated by Turbotax so editing it directly was never an option.

Unfortunately the only solution I can think of to these problems is to use a different tax product.   IRS rules are challenging enough without also having to resolve Turbotax bugs and idiosyncrasies.

[AnnetteB6]

No, I am not saying that you can skip all the menus and edit the forms directly.

Not every field on every form can be entered manually in Forms mode without affecting the ability to electronically file.  But, if there is a corresponding input item in the step-by-step mode, you can generally edit it in Forms mode.  The key is that you must be editing the exact field that corresponds to the input from step-by-step, which can be tricky to find.  

In the instructions for the home office calculation above, the input that needed to be made was done in a smart worksheet embedded in the Form 8829.  It was not editing or adding to Form 8829 directly so it did not require an override.  Overrides do disallow electronic filing.

@user17735820217