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Idaho Child Care Deduction Error in Calculation

This is similar to another question I found, however the answer was not satisfactory.

 

Idaho Form 39R, Line 6 (child and dependent care deduction), directs to worksheet on page 30 of Idaho Tax Instructions. 

 

Here is an example of following the worksheet similar to how I followed it for my return:

1. Enter the amount of qualified expenses you incurred and paid in 2023. Don’t include amounts paid by your employer or excluded from taxable income: $6,000

2. Enter $12,000 for one or more child or dependent cared for during the year: $12,000

3. Enter excluded benefits from Part III of Form 2441: $5,000

4. Subtract line 3 from line 2. If zero or less, stop. You can’t claim the deduction: $7,000

5. Enter your earned income: $50,000

6. If married filing a joint return, enter your spouse’s earned income. All others enter the amount from line 5: $60,000

7. Enter the smallest of lines 1, 4, 5, or 6 here and on Form 39R, Part B, line 6: $6,000

 

The total amount of childcare expenses paid in this example is $11,000. $5,000 was paid through a dependent care FSA (pre-tax, and matches line 3 of the worksheet), and another $6,000 was paid from after tax money. However, Turbotax is entering $7,000 into my return on line 6 of Idaho Form 39R instead of $6,000. I do not think Idaho would like for me to double-dip my tax deductions. In this case, entering $7,000 on line 6 would be a $1,000 double-dip, since $5,000 pre-tax from FSA plus $7,000 deduction is $12,000, which is $1,000 more than the total childcare expenses paid in this example.

 

Note that I already shared my tax file with a Turbotax specialist and after about an hour on the phone, they couldn't find any errors in what I entered, and they understood the problem I describe here. Their suggestion is that Turbotax guarantees the accuracy of the return and to ignore the discrepancy I discovered. Should I file knowing there is an error in the return that is unable to be fixed?

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3 Replies
AnnetteB6
Employee Tax Expert

Idaho Child Care Deduction Error in Calculation

Whether or not you should file a return with a known discrepancy is a personal decision to make.  If you do file the return and you receive a letter from the Idaho State Tax Commission requesting payment for the error, then you would need to file a claim against the TurboTax Accuracy Guarantee which would pay any penalties and interest charged to you based on the error.  Any income tax discrepancy would be paid by you.  

 

That being said, if you are willing to share your diagnostic tax file once again, we can take a closer look at the situation and submit it to the developers for a correction.  This process could take some time.  In the meantime, you could consider filing your state return by mail.  

 

The diagnostic file will not contain personally identifiable information, only numbers related to your tax forms.  Follow the instructions below and post the token number along with which version of TurboTax you are using in a follow-up thread.

 

Use these steps if you are using TurboTax Online:

 

  • Sign in to your account and be sure you are in your tax return.
  • Select Tax Tools in the menu to the left.
  • Select Tools.
  • Select Share my file with agent.
  • A pop-up message will appear, select OK to send the sanitized diagnostic copy to us.
  • Post the token number here. 

 

If you are using a CD/downloaded version of TurboTax, use these steps:

 

  • Select Online at the top of the screen.
  • Select Send Tax File to Agent.
  • Click OK.
  • Post the token number here.

 

Also, here is some additional information about the TurboTax 100% Accurate Calculation Guarantee:

 

What is the TurboTax 100% Accurate Calculation Guarantee?
 

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Idaho Child Care Deduction Error in Calculation

Thank you for the quick reply! My token number is 1197407. I am using TurboTax Online Deluxe. 

 

For the option to file my state return by mail, is that suggestion so that I could manually replace the erroneous forms with forms containing correct information? I thought about doing that, but wasn't sure how that would impact the TurboTax 100% Accurate Calculation Guarantee. If there is a different reason filing by mail may be advantageous, please let me know. 

 

I appreciate your help!

AnnetteB6
Employee Tax Expert

Idaho Child Care Deduction Error in Calculation

Yes, the reason for filing by mail would be to be certain that the forms were correct.  

 

However, that should not be necessary.  The issue was reported and is being addressed.  Take a look at the following TurboTax help article and click the button to register your email address so that you will be notified as the update is completed.

 

Why is my Idaho Child and Dependent Care Deduction worksheet not calculating the deduction correctly...
 

@spentango 

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