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Level 2
posted Mar 3, 2023 7:14:31 PM

Bug: Inconsistent 1099-SA Rounding

This year I have multiple 1099-SA forms reporting HSA distributions of different types.  The problem is that TurboTax rounds the distribution amounts inconsistently.  It adds all of the amounts together before rounding the total into form 8889 Line 14a.  It then uses an individually-rounded value in line 14d.  When the two values are subtracted, the result is incorrect.  It should match the amount in line 15, but it doesn't.  Instead it generates a non-zero value in line 16, which is incorrect and is carried downstream.  I tried overriding the computed values, but TurboTax flags this as an error.  The only workaround seems to be to round the values in the original 1099-SA forms. I'm assuming these aren't filed, so it's probably OK, but it would be better if they were handled consistently outside of the 1099-SA forms.

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1 Replies
Alumni
Mar 6, 2023 6:59:46 PM

bhingles,

 

I agree that there is a problem related to rounding.  This is, IMHO, the IRS's fault by forcing all commercial software to do rounding so that TurboTax is forced into situations such as what you encountered.  Indeed, I actually file on paper and put in all the cents for my taxes just to avoid the ambiguity.  It even saves me a buck every so often.  That said, the IRS has built-in code to allow a modest amount of deviation such as the one you are seeing due to rounding.  (The rounding rules are specified in the tax code and basically say to add the pennies when totaling a figure to round and enter onto a schedule.  They are not fully unambiguous, however.) From what I can tell, your difference should only have been $1 and in 99 44/100ths of the time that won't change your tax bill.