Worksheet for the deferral of self employment tax

[ettapearl1223]

According to the software I'm not eligible for the self employment deferral credit.  I agree, I don't want to defer anyway.  However when I run the error review the worksheet indicates "0" is to large.  Error in coding for calculation????? 

[AmyC]

Go back into the program:

1. Go back into Personal credits and deductions section
2. Scroll down to COVID-19 tax relief
3. Click edit/update for Self employment tax deferral
4. Select no  to deferral.

The self-employment tax on that portion can be postponed for payment in the following year. You can postpone that portion of your taxes due with no penalties or interest, if you qualify. If the program is saying you do not qualify, you must be getting a refund.

You might also have a piece of data stuck, you may want to clear cookies and cache or change browsers.

[evamariedeneski]

The question to not accept the tax deferral doesn't seem to stick. After days of trying to figure out a way forward, the only way I have found to get past the error that in Part III of the maximum deferral of Self Employment Tax Payments is to say 0 to line 18. This appears to be a bug to me. Looking for feedback.

[KathrynG3]

It actually is better to not enter 0 in line 18. 

TurboTax is asking you to revisit the section regarding deferring a portion of the self-employment tax because before a refund was calculated, you were eligible. However, with a refund, you are no longer eligible.

Go back to the interview section to correct these entries and un-trigger any deferral that you can no longer take and probably later declined. You will need to initially accept it before declining.

To do this in TurboTax, follow these steps:

Enter a temporary amount as income in the self-employment section that will result in you not having a refund.

1. From the left menu, select Federal.
2. From the Income & Expenses, scroll to Self-employment income & expenses and Edit/Add.
3. At Your 2020 work summary, select Edit.
4. Under INCOME, select Add income for this work.
5. Add Other self-employed income, includes 1099-K, cash, and checks and Continue.
6. At Type of income, enter Temp income to remove deferral and enter a large amount, such as $100,000 and Continue.

Decline to defer any self-employment tax.

1. From the left menu, click on Federal.
2. Click the second tab from the left, Deductions & Credits.
3. Scroll down to Tax Relief related to Covid-19 and Revisit.
4. Select Self-employment tax deferral and select Revisit.
5. Answer Yes at the next screen to get back to Let's start by getting your eligible income.
    

1. Enter 280/366ths of your income to reflect the income from March 27-December 31, 2021. 
   1. This amount should be the same as the correct amount on Line 18 of Sch SE.

1. Select Continue.
2. At Tell us how much you'd like to defer, 
   1. Enter 0.

Remove the temporary income.

1. From the left menu, select Federal.
2. From the Income & Expenses, scroll to Self-employment income & expenses and Edit/Add.
3. At Your 2020 work summary, select Edit.
4. Under INCOME, select the Trash can icon next to Temp income to remove deferral and Continue.

For more details, see TurboTax Expert @DawnC's answer here, about 2/3 down the page: Resolve Sch SE-T Max Deferral Line 18 must be entered.

@evamariedeneski

[evamariedeneski]

This instruction you gave me is insane. You need to do a better job making this software better and more user friendly. 

[dmertz]

That convoluted procedure is unnecessary.  When Smart Check flags this entry in this way, just delete the entry to remove the zero.