Form 8829 in 2025 Home and Business Desktop - Property tax cell incorrectly configured

[maryherndon54]

I'm using 2025 Home and Business Desktop and am working on Form 8829 (Office in Home Deduction for Sch C).  My husband and I have four businesses and file four Sch C's, with four Form 8829's.  We also have a small rental on our property (Sch E).   Normally TurboTax has done a good job of properly carving up home real estate taxes first: to Sch E, the balance to each Form 8829, and then what remains is carried to Sch A.    The calculation is presented on the Tax and Interest Deduction Worksheet line 2.

This year there is a problem, and it is with Form 8829.

On Form 8829, home real estate taxes (along with other home maintenance expenses) are normally prorated, based on a calculation (sq footage of office vs sq footage of home).  This requires 100% of the real estate taxes paid to be entered on line 11 in the "Indirect Expenses" column for EACH Form 8829.  The proration percentage is applied and the result is added to other prorated home expenses for that Form 8829. 

This year, TurboTax is generating an error message if the total of the real estate tax amounts entered in the indirect expense column on ALL Form 8829's exceeds $40,000.  Bear in mind that each Form 8829 requires the entry of 100% of taxes paid in the indirect expense column, so if someone (like me) has four Form 8829's, it is highly likely that 4x the total property taxes one pays these days will exceed $40,000, and this is setting off a warning flag.  (And yes, I did first go through Step-by-Step and check the box for each 8829 that the property tax amount being entered is also entered on another Form 8829.)  

I know this is where the error lies because if I remove the the real estate tax amount from just one Form 8829, the error message disappears from all.  I tried entering the prorated amount only in the direct expense column of the form, but this causes an error because the amount of real estate taxes entered in the direct expense column doesn't carry to  the Tax and Interest Deduction Worksheet line 2, and the proper balance doesn't carry to Sch A.  

I've been running this calculation for years, and this is the first time I've gotten this error.  I went back to the Home & Business 2024 and reviewed my entries and they are identical to those I entered this year.  But there was no error last year.   Because this is showing up in final return review, it  prevents me from being able to e-File. 

Help!

[AnnetteB6]

In order to take a closer look at the situation you described and report it to the development team for further investigation and potential corrections, it is very helpful to have an actual customer diagnostic file demonstrating the situation.  Please consider sharing a diagnostic copy of your tax file so we can take that closer look.  The diagnostic file will not contain personally identifiable information, only numbers related to your tax forms.  

If you would like to provide us with the diagnostic file, follow the instructions below and post the token number along with which version of TurboTax you are using in a follow-up thread.

Use these steps if you are using TurboTax Online:

• Sign in to your account and be sure you are in your tax return.
• Select Tax Tools in the menu to the left.
• Select Tools.
• Select Share my file with agent.
• A pop-up message will appear, select OK to send the sanitized diagnostic copy to us.
• Post the token number here. 

If you are using a CD/downloaded version of TurboTax, use these steps:

• Select Online at the top of the screen.
• Select Send Tax File to Agent.
• Click OK.
• Post the token number here.

If you are using a Mac version of TurboTax, use these steps:

• Go to the Menu at the top of the screen and select Help.
• Then, Send Tax File to Agent.

Post the token number here.
 

[maryherndon54]

I followed your instructions.

Here is the  token #:

   [removed]-93099063

Please let me know next steps.

Thank you.

[rprezeau]

I am having exactly the same problem.  It's the only thing keeping me from filing.  It gives me an error message to "Check this entry" for "form 8829, Line 11b SALT Amounts for real estate tax deductions are limited to a combined total of $40000".  Can you please help?

[maryherndon54]

Thank you.  That is exactly the same error message I got in error check mode.  I forgot to mention this.  Much appreciate your added comment.  I'm waiting for TurboTax's review.

Hopefully a solution before April!

[rlaub]

Using Turbotax Premier and getting the same error Form 8829 with 2 separate home offices and 2 separate schedule C's.  There is another whole thread with people getting this error with no resolution.

[RAinMD]

Yup, same issue. Waiting for someone to fix this. How long is this going to take to get this issue resolved with everyone having the same problem. It's clearly a bug, why won't TT fix it?

[hfluss]

Chiming in here as well - same error with two home offices and the sum of the RE taxes  entered exceeding 40K.

By playing around with the numbers, I found that the 8829 errors went away if I sufficiently reduced the second home office entry for RE tax. I didn't realize until reading this thread that the magic number I found was the one that made the total exactly 40K.

Hoping the development team fixes this one soon ...

[rlaub]

I noticed that too.  But it reduces the amount of my refund.

If you itemize, there is a worksheet in the IRS instructions to calculate excess real estate taxes.  Very confusing, however.

[maryherndon54]

OK, I finally managed to get TurboTax to respond to me (sharing my file here did nothing, I was ignored until I engaged with enough phone support agents (over 6 hours of phone time) to get to a supervisor who actually looked at my file, and ultimately did email me a reply.) 

Technically, the reply was NOT responsive.  TurboTax is unable to explain why an error message is generated when multiple Form 8829’s are filed, and the total of all entries on line 11 column (b) equals or exceeds 40,000.  

However, they did direct me to a couple of things worth paying attention to: 

They sent me to their Unsupported Calculations page (I’ll call it “USCP”):

https://digitalasset.intuit.com/render/content/dam/intuit/cgcs/en_us/turbotax/pdfs/[phone number rem...

Page 10 line 7 of TurboTax's USCP refers to the Line 11 Worksheet in the IRS instructions for Form 8829.  TurboTax doesn’t support entries on line 11 of Form 8829, if this worksheet is required.  I was surprised to discover that for this year, most 8829 fliers will likely fall into this category for 2025. 

I suggest you read Form 8829 instructions for line 11. 

1. If, because of the increased Standard Deductions (“SD”) this year (and seniors should pay close attention here) you find that your total Itemized Deductions don’t exceed the SD, you are instructed NOT to put anything on line 11 at all.  Instead, you are guided to line 17 “Excess Real Estate Taxes”, col (b).   (As a reminder, the SD does NOT include the extra $6,000 deduction for Seniors.  That’s added afterwards.)   I will note here that according to its USCP, TurboTax does not support entries on line 17 of Form 8829 due to the SD being used (page 10, line 5 and 6)

1. If you ARE Itemizing, the ONLY time you DON’T need to complete the Line 11 Worksheet is if the total of all your SALT (State and Local Tax) deductions on Sch A (this would include state and local income/sales tax plus real estate (RE) tax plus personal property tax – basically the amount on line 5d of Sch A) IFF this total is LESS than $10,000, ONLY THEN are you allowed to make an entry on line 11, col (b) without first completing the Line 11 Worksheet.  (And yes, the cap here is $10,000, not the $40,000 cap on RE tax for Sch A this year  (Note: The IRS doesn’t seem to be concerned that this is basically an iterative calculation because technically, you need to know the amount of your 8829 RE tax deduction FIRST in order to enter the correct amount of real estate taxes on Sch A).  This will impact a lot of people, so be aware.  And finally:

1. Basically, as far as I can tell, if you have to complete the Line 11 Worksheet, you will ultimately be instructed to make your RE tax entry on Form 8829 line 11, col (a) (Direct Expenses) and NOT col (b) (Indirect Expenses). 

Because of this, most people completing Form 8829 are not supposed to be making an entry on line 11, col (b) at all.

Also, just as a reminder, if you also have a home rental and are filing Sch E, TurboTax doesn’t carve out the amount of RE taxes deducted on Sch E before entering the amount on Form 8829, line 11, col A.  You have to do that yourself.  So if you have, say,  $10,000 in RE taxes and $4,000 of these were allowed as a deduction on Sch E, the amount of RE taxes to enter on line 11 of each Form 8829  is $6,000 (not $10,000).  The balance after Form 8829 deductions will go Sch A.   (This matches the IRS ordering of RE tax deductions)

Hopefully this is helpful.

[hfluss]

@mary - Excellent summary - thanks!

I did go through the F8829 line 11 Worksheet, and ended up with direct excess RE taxes.

Of interest, the 8829 instructions do say that that Sch A RE taxes should of course not include what's allocated here (line 6) of the Line 11 Worksheet.

HOWEVER - TT only picks up the real estate and not excess real estate from the 8829's. I tried overriding the value on line 2f of the TT Tax and Interest Deduction Worksheet ("less real estate taxes deducted on Form 8829) but that caused an error.

TT bug/feature or do I get to deduct it twice ....

[rlaub]

I am having the exact same issue.  The real estate taxes in column A, line 17 of form 8829 does not reduce my total real estate taxes on Schedule A.  I tried to override it in the tax and interest worksheet but it creates an error.  Is there no solution of any of this?

[hfluss]

What I did was to add supporting details for the RE taxes (line 2f), list the total paid, and then subtract the 8829 amount.

[rlaub]

Did you do that on line 2a or 2f.  I'm unable to add supporting details for line 2f.

[hfluss]

Oops - I meant 2a, using the value that should be in 2f, which is left at 0.