Question about "State Tax Refund Worksheet" Error from Smart Review

[fp5849]

Question about "State Tax Refund Worksheet" Error from Smart Review.

Smart Review give the following message:

"State Tax Refund Worksheet: Item Q Line 2 should be entered. Enter zero of none."

I can not find this worksheet listed under Forms (turbotax 2022).

How am I to know if the value should be zero or some other value?

[fp5849]

Will someone please give me guidance about this issue?

It occurred on my 2021 TurboTax return and no one offered any help.

Now I have the same issue with my 2022 TurboTax return.

[KrisD15 · Accepted solution]

Enter what you claimed as "personal property tax" paid in 2021. (vehicle registration for example) 

Item Q line 2 is asking for the amount of personal property taxes you deducted on last year's return. 

This normally would be what you reported as paid for vehicle registration, but could also be for a boat or other large item you own. 

If you took the Standard Deduction last year, which most people did, the state tax refund is NOT taxable and you needn't even enter the 1099-G.

You don't need to go through the interview in TurboTax. 

If you ITEMIZED deductions in 2021, you would have Schedule A with your tax file for 2021.

On Schedule A, you deducted State Tax that you paid in 2021. 

This includes State INCOME tax, like what they withhold on your W-2, and

State Property Tax, including real estate and personal property 

OR 

You had the option of claiming state SALES tax instead of state income and property tax. 

Since the state return is always calculated AFTER the Federal return, it is POSSIBLE that a Taxpayer would claim 1,000 state tax as a deduction on their schedule A and then get a 400 state refund, so they need to adjust for this 400 they claimed in one year but got back the next year.

To figure if the refund is taxable, the program needs to know:

Did you Itemize or use the Standard deduction last year ?

If Standard, we are done, refund is not taxable

Itemized, but took State SALES tax (not state income/property tax) ?

Refund is not taxable

Itemized and took State Income Tax and/or State Property tax ? 

HOW MUCH OF EACH DID YOU CLAIM? 

Getting back to the State Refund Worksheet, 

Item Q Line 1 is the State "Real Estate" tax (property tax on your house and land)

Item Q Line 2 is the State "Personal Property" tax (the tax you might pay on vehicle registration, depending on which state you live in)

Item Q Line 3 is the total State tax you were able to claim on your Schedule A

[fp5849]

Thank you some much for helping me understand this issue.

In 2021, I could not find the worksheet referenced and did not get any replies that helped me with my question.

So, I finally just blindly entered a Zero on the Fix It popup screen to correct the error and just hoped it was the correct thing to do. (Which I now know turned out to have been the correct value)

When I encountered the same thing again for 2022 and still could not find the worksheet needed, I was very frustrated.

Your explanation helped me to understand that the "St Refund Wks" was where to look.

Note: As I used the guided method to enter information for both 2021 and 2022, and did not claim any Personal Property Taxes either year, I don't understand why the program didn't just enter Zero, by default. They are numerous other entries which are left empty when the topic did not apply or was answered with a "No" to the guided questions. This would have spared me two years of frustration and concern about the accuracy of my returns.

Thank you again for your time and assistance.