Possible bug in handling Medicare Part B premium deductions

[Gary114]

                I am using TurboTax Home & Business 2020.  When TurboTax has you input information from Form SSA-1099 (for social security payments), it has you enter, among other things,  the amount of the Medicare Part B premium deduction.  Then TurboTax automatically places this Part B premium amount (which is for a type of health insurance) in the health expenses section of Schedule A for itemized deductions. 

                   However, this apparently does not take into account the situation where one, like me, is self employed and qualifies for having this Part B premium amount appear as a self-employed health insurance deduction under the "Adjustments to Income" portion of Schedule 1, instead of appearing in Schedule A.  This can result in a more favorable deduction. 

                  The only way I could figure out to fix this is to override what TurboTax wanted to do by going straight into the Forms section of TurboTax and manually removing the Part B premium amount from the Form SSA-1099 input screen, and by making sure it was included in the Adjustments to Income of Schedule 1 form.

                Am I correct in understanding that this is a bug in TurboTax?   Is the manual override described above the best way to handle this?

[VolvoGirl]

Right,but it's not a bug.

Medicare plan B payments are qualified as Self-employed medical insurance premiums and should be entered under Business instead of in the Social Security Benefits entry area.  So go back and take it off your SSA-1099 entry.

You don't have to manually enter it or override anything.  Just don't enter it from the SSA-1099 and enter it in the interview steps as regular ins under business.

[DoninGA]

There is no need to manually override the form.  You can just remove the amount of Medicare premiums paid in the Social Security section of the program, then include those premiums as self-employed health care expense in the Business section of the program.

To enter, edit or delete Social Security benefits reported on form SSA-1099

• Click on Federal Taxes (Personal using Home and Business)
• Click on Wages and Income (Personal Income using Home and Business)
• Click on I'll choose what I work on (if shown)
• Scroll down to Retirement Plans and Social Security
• On Social Security (SSA-1099, RRB-1099), click the start or update button

Or enter ssa-1099 in the Search box located in the upper right of the program screen. Click on Jump to ssa-1099

[Gary114]

Thank you.  I don't believe that TurboTax warns a user who is inputting SSA-1099 information that one should not input Part B premiums if one is self employed.  Perhaps there are TurboTax users who may not know that they should not be inputting this as a SSA-1099 entry and who may end up with a smaller adjustment to income (e.g., deduction). 

[VolvoGirl]

Funny you should post that.  I was just making you a screen shot.

[Gary114]

Volvo Girl:   Thank you for this clarification !    I guess the lesson here is to always click the "learn more" link for every entry that one makes in TurboTax.

[Mike9241]

I think Turbotax could do a better job. they could have put the explanation right below rather than use the learn more link.

in the desktop version in forms mode that's exactly what is done

[kare2k13]

@DoninGA  I am so glad I researched this further in the postings.  I posted the same problem a few days ago with tons of views, but no answers.  This is exactly what I needed.  Thank you so much. 

[kare2k13]

@VolvoGirl  I am so glad I researched this further in the postings.  I posted the same problem a few days ago with tons of views, but no answers.  This is exactly what I needed.  Thank you so much.  

[kare2k13]

@Gary114  Thank you so much!  I totally agree.  Now I have to find out if I need to amend prior return(s) due to the error. 

[kare2k13]

@VolvoGirl   Thank you for the suggestion, but I use the "Learn More" constantly while I'm preparing and usually find it very helpful.  I even copy it into my prep documentation to refer to in future preparations.  But in this case, I didn't see any need for it since I was just completing what TT was requesting from the form.  It would be very helpful if TT would make it clear that we shouldn't enter that information in this section.  Maybe just not ask for that information in our Biz version. 

[kare2k13]

@VolvoGirl   I deeply appreciate your assistance.  I learn so much from your posts.  I easily made the correction.  Now I need to know if I need to amend any prior year(s) due to that same error I hadn't noticed before.  Thank you. 

[JotikaT2]

If your prior returns are incorrect and the correction results in a change in the overall tax liability, then yes, you should also amend those returns to ensure correct tax returns are filed.  Please see this FAQ for guidance on amending a prior year return.

Do I need to amend my return?

@kare2k13 

[kare2k13]

@JotikaT2   Thank you for your response and direction.  No need to amend, thank goodness.