Alabama State Tax Schedule D Negative Amount Not Eligible for e-file

[arkman77]

I filed my son's Federal and Alabama state taxes and both of us had negative amounts received on Schedule D.  When I filed his return, it appears to have filed with no issues.  When I'm in final review for my taxes, I get ineligible for e-filing with a reason stating "Returns with a negative amount received on Schedule D are not eligible for electronic filing."  I do not remember seeing this message when doing my son's taxes and I've looked at the Alabama Form 40 and Schedule D instruction booklet and have not yet found a rule like this.  Might someone be able to point me to where this rule is stated for Alabama and second, what action should I take on my son's taxes that are already submitted via e-file?

[DavidD66]

Can you clarify something?  What type of transactions did you report on Schedule D that had "negative amounts received"? 

[arkman77]

Stock and options trades that were over-all negative for the year.  I think what may be triggering this is that two of the 1099-Bs have "transactions for which the cost basis is not reported to the IRS."  For Federal forms, TurboTax instructs me to mail those two 1099s to the IRS with Form 8453 attached.  I suspect there is no similar mechanism for such additional information submission in Alabama (I did a quick look).  Though their web site claims you can upload PDF tax files, I couldn't find a way to do so.  I think there are two possible options.  1. Submit electronically and wait on a phone call from the Alabama tax folks asking for the additional info.  2. Submit and mail by paper copy with all the attachments Alabama requires, which will be over 100 pages and is much less secure.

I really appreciate your feedback and look forward to your response!

[AmyC]

You are correct, AL no longer uses the 8453. The AL DOR is pretty easy to work with so I would recommend filing electronically. If they send you a letter, you can reply with whatever they want. They process replies quickly and I would not expect you to have an issue dealing with the AL DOR.

The MAT (My Alabama Taxes) has a document on uploading to MAT. I do not know the limitations of the system.

[arkman77]

Thank you sooo much!  Very helpful!

[arkman77]

One more related question.  I'm running TurboTax Deluxe desktop and it properly skips the already filed Federal return, but when I get to the state return area and the software comes back with a window that says "You cannot e-file this return."  There does not appear to be an option to bypass this page and when I hit continue, the software loops back to the original "How do you want to file" screen.  Is there a way to force the software to proceed with e-file?

[CarissaM]

Has your federal return been accepted and processed yet?

[arkman77]

Yes, Federal return was submitted and accepted.  I just cannot get the state tax form to submit electronically due to the screen informing me that I have to submit it on paper.  Does not appear to be a way to bypass the error trap to force submission.

[SForrestLO]

Please see this Turbo Tax help article for more information.
How do I e-file my state after I already filed my federal?

@arkman77

[arkman77]

I'm very familiar with the instructions and how to navigate to the state e-file options.  My problem is that TurboTax will not let me e-file due to the extra info needed on 2 of my 1099-Bs (see prior posts for details).  Turbotax sees this as an error and says that I cannot e-file for state, which is a pain for about 6 pieces of needed papers.  There should be a way to override TurboTax to e-file anyway, but there does not appear to be a way to do so or no one can tell me how.  Filing paper copies for state requires all W-S, 1099s, 1098, etc. that the state doesn't need and that I don't want to put into a single envelope.  (We've had issues with mail theft and having envelopes opened.)  I wish to e-file and only provide what is needed, not all the additional unneeded forms on paper.  Is there a way to get past the TurboTax error check that stops me from e-filing the state taxes? 

[AmyC]

Unfortunately, I have been trying to find an answer by collaborating and was informed by a manager that you will indeed need to mail in the tax return. 

I absolutely empathize with mailing. I suggest you send the mail with tracking to ensure its safe arrival of your private information.

[zzzzzzzzzzzzzzz]

I have the same issue.  I now have to print about 300 pages for my Alabama paper return.  I never had this problem with TaxAct in the past.  I will go back to using TaxAct for 2023 instead of TurboTax if TurboTax doesn't fix this issue for Alabama state returns.

[lasers26]

HOW TO FIX: If anyone encounters this error, don't import 1099-b, instead just enter totals manually. It looks like turbotax doesn't sum up individual transactions correctly.