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sjg1
Returning Member

Why do expenses/deductions have no impact on State tax owed?

Unlike in previous years, I'm not seeing the tax owed to State (CA) reducing at all, as I enter expenses and deductions.  I've installed multiple updates and the issue remains?

 

Anyone else seeing similar?

 

Don't know if starting over will make any difference...

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3 Replies

Why do expenses/deductions have no impact on State tax owed?

What expenses or deductions are you entering?  Are they Schedule C expenses or Schedule A itemized deductions?  When you are done entering them start California over again for it to update.  

sjg1
Returning Member

Why do expenses/deductions have no impact on State tax owed?

Thanks,

 

Not sure about scheules - just simple things like donations to charities and car registration, even if not deductible for federal - because itemizing no longer worthwhile, they still normally count for state.

 

The major portion of the "excessive" taxes owed to state was  due to a capitol loss carryover not applied automatically - since CA may treat it differently.  Once that was addressed the numbers are more in line with what I expect, but still the donations etc, seem to have no impact.

MonikaK1
Expert Alumni

Why do expenses/deductions have no impact on State tax owed?

As stated in this TurboTax help article:

 

Instead of a refund meter at the top of your screen, you’ll see your refund or taxes due in the Federal Review section of TurboTax Online. For accuracy and simplicity, we show these totals after you enter your income, deductions, and credits instead of a running refund tracker at each step of the filing process.

 

This change was made for the tax year 2024 products.

 

Taxes are often calculated using a different method than the tax tables. For example, if you have capital gains, the tax on those is calculated at the capital gain rate for your income level. If you are self-employed, you may have self-employment taxes in addition to income taxes.

 

You can still preview your return before filing to find out how your taxes were calculated. See here for details. You can also view the Tax Summary under Tools on the left-side menu in TurboTax Online.

 

@sjg1 

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