Turbo Tax for 1120S - Wages Bizarre Behavior

[beyondthebox]

Using TurboTax 1120s, Under Your Deductions / Compensation and Benefits:

1) I added my Wages

2) I clicked the start button for "Enter Insurance and Other Benefits", and added dollar amounts to the ">2% owner" column and clicked continue

3) I did not see a total on the summary form next to "Enter Insurance and Other Benefits" so I presumed the values did not qualify and moved on to other things

Today when I revisited the return I saw an incorrect total wage amount and of course tried to fix it but it would not let me set the correct number. I then spent an hour trying to find the $ discrepancy. No luck.

The summary page offered no clue and the values are not present on any form or worksheet making it hard to find the issue. In the end I realized that I had forgotten about the values under "Enter Insurance and Other Benefits" section. 

Turbotax needs to revisit this area and change the approach. Most people filling out the 1120S likely have a wage totals that likely already reflect the values under "Enter Insurance and Other Benefits". Most importantly, Turbotax should not use value on forms that are not reflected on a worksheet.

Hope this helps someone who might encounter the same issue.

[JamesG1]

Form 1120S requires fringe benefits for the greater than 2% owner to be reported under Compensation of Officers.

Instructions for Form 1120S page 16 line 7 Compensation of Officers states:

Include fringe benefit expenditures made on behalf of officers and employees owning more than 2% of the corporation's stock. Also report these fringe benefits as wages in box 1 of Form W-2. Don't include amounts paid or incurred for fringe benefits of officers and employees owning 2% or less of the corporation's stock.

[beyondthebox]

Thanks for your response but I don't think you understood what I was trying to describe.

I did put those fringe amounts into TurboTax on the deduction page. After doing so, no total appeared on the page reflecting the amounts I entered. I presumed that they did not apply and I did not not notice TurboTax had added the values to the W2 amount. 

When I came back a few days later I saw an incorrect W2 amount. I tried to correct but could not. I searched all the forms for any indication of the amount that was persistently being added to the W2 and did not find that information on any form in the return. Perhaps you can tell me which form has that information.

Only by chance did I click the "Health Insurance" deduction and see the values I had typed in previously. Again, these values were not on any form or worksheet. Turbotax just totaled them and added them to the W2 amount.

While that is technically correct, TurboTax did not ask if that amount was already reflected in the W2 wages. It just assumed "NO" but in reality, W2s should already reflect this information.

When I added the values to the Health Insurance Deduction under >2% owners, TurboTax should have asked me if the amounts were already reflected in W2 wages and not assume they were not. Also, Turbotax should show the values entered for that health deduction somewhere in the return and it does not.

Bottom line, Turbotax needs to be fixed to properly account for Heath and other Fringes for >2% owners.