How to report a BUG and error with TurboTax Home and Business 2022 desktop

[noclue1040]

I would like to report a bug I encountered this year. TT help desk could not help with my situation or direct me to someone/department that can I can report this to.

I used desktop TurboTax for Home & Business to file my 2022 taxes. My W-2 was uploaded from ADP and all of the entries in all of the W-2 boxes in my Turbotax forms is identical to the one I received from my employers.

I entered all of the requisite information and had no errors on Federal or state tax review and I e-filed my 1040 and my state forms in February. I received a 12C letter from the IRS requesting more information. When I was gathering the requested information I discovered that TurboTax made a transcription error and it had inserted my W-2 box 5 (Medicare wages/tips) information into line 1a of my 1040. This resulted in incorrect values in lines 1z, 9, 11, 15, 16, 18, 22, 24, 34, and 35a. This mistake miscalculated the final Federal tax on my income--instead of receiving a refund that the TurboTax program calculated, I owe an unknown additional amount in Federal taxes.

Have been using TurboTax for almost 30 years and have never encountered this before. Agent at TT call center was unable to assist. Am waiting to hear back from the IRS return reject team for final tax amount owed.

Would it be possible for someone to look over my info and figure out what went wrong? Am wondering if this affected other people as well.

Thank you in advance.

[AliciaP1]

It would be helpful to have a TurboTax ".tax2022" file that is experiencing this issue.

You can send us a “diagnostic” file that has your “numbers” but not your personal information.  If you would like to do this, here are the instructions: 

In TurboTax Online, go to the black panel on the left side of your program and select Tax Tools. 

1. Then select Tools below Tax Tools. 
2. A window will pop up which says Tools Center.  
3. On this screen, select Share my file with Agent. 
4. You will see a message explaining what the diagnostic copy is.  Click okay through this screen and then you will get a Token number. 

In TurboTax CD/Download versions, go to the black panel on the top of your screen and select Online. 

1. Scroll down to and select Send tax file to Agent. 
2. You will see a message explaining what the diagnostic copy is.  Click send through this screen and then you will get a Token number. 

Reply to this thread with your Token number. This will allow us to open a copy of your return without seeing any personal information.   

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution.

@noclue1040 

[noclue1040]

AlicaP1--

Thank you for your reply.

The token number is 1130990.

Thank you again!

[AliciaP1]

Upon review, your tax return is correct with the Box 5 amount listed on line 1a.  The IRS changed the reporting line for Nonqualified Deferred Compensation plans to line 8t of Form 1040 Schedule 1.  The IRS is not asking for an amended return, just that more information be provided for the topic the letter references.

Per the IRS:

If you received a pension or annuity from a nonqualified deferred compensation plan or a nongovernmental section 457(b) plan and it was reported in box 1 of Form W-2, do not include this amount on Form 1040, line 1a. This amount is reported on Schedule 1, line 8t.

@noclue1040 

[noclue1040]

@AliciaP1--

Thank you for reviewing the file and thank you for your explanation.

Nice to know that I am getting a refund after all.

Thank you again for your help! Have a great rest of the weekend!

[dkm17171]

I have a similar problem in that in previous years TT reported deferred comp from a W2 on Line 1 and for 2022 it was reported on Line 8t.  The Federal IRS is holding my return pending either this issue or something else. However,  reporting this way and when doing my taxes for the State of IL (one of 2 states I needed to do my taxes with) is saying this income was earned in IL and needs to be reported as such and they reduced my refund significantly.  Reporting based on the federal changed the State of IL returns and IL does not agree.

Who is correct?  I also file IN State return and I am not certain of this effected my IN return or not.

[MarilynG1]

Since retirement income from a Non-Qualified Deferred Compensation Plan, reported on a W-2, is not excludable in Illinois, the distribution is taxed as regular income.

Other states would most likely handle this type of income similarly.

Here's more info from Illinois Dept. of Revenue.

@dkm17171 

[dkm17171]

Thank you for your reply.

1) the link you provided does not go anywhere.

2) it sounds like what you are saying is that the state of IL is correct and there is an error in the TT software that is causing TT to incorrectly complete my IL taxes.  Will there be a fix to this that I will get to "redo" my IL taxes and confirm the numbers the state of IL says my taxes due are correct?

[dkm17171]

"Our calculations are 100% accurate so your taxes will be done right, 

guaranteed, or we’ll pay you any IRS penalties."

This is a statement on the TurboTax website. I have done my taxes the same way with the same forms of income for several years.  This year (2022) my deferred comp funds were put into a different category and as a result the state taxes (IL) did not show that I owed money but IL IRS does not agree.  An expert on this site indicated that this is correct, that my IL state deferred income would be subject to tax.  However, TurboTax put the numbers in based on the same information I provided in the past.  How do I get this corrected and how to collect any interest and penalties that are now accumulating from TurboTax?

[DoninGA]

@dkm17171 

See this TurboTax support FAQ for the submitting a claim under the TurboTax 100% Accurate Calculation Guarantee - https://ttlc.intuit.com/turbotax-support/en-us/help-article/intuit-account-billing/submit-claim-turb...

[dkm17171]

Thank you for the reply.  Can you confirm that TT will be updating their software to resolve this error so that I cna be sure that the IL IRS numbers match up with what TT says as well as to be sure that this error in the software did not also impact my federal and IN state tax returns.

[WT6]

Is there a way to report a bug that doesn't require sending my tax data?  There is an obvious bug related to Social Security for emigrants that I have been trying to get fixed for three years, but it's pretty much like shouting down a well.  My tax data would be of no help anyway.

[DaveF1006]

No. We may not require tax data. What we need to know is the specific issue in detail on what you are experiencing.

[WT6]

Is this the place to report it?  If so, I'll try again.  IRS publication 915 states that U.S. citizens who reside in Canada, Egypt, Germany, Israel, Ireland, Italy, Romania and the UK are exempt from U.S. taxation on their Social Security benefits.  The Turbo Tax instructions for people in this situation are to simply not report their benefits on line 6a of Form 1040.  This is NOT what the IRS instructs us to do in publication 915.  It says to report the benefits on line 6a and put a zero into line 6b.  But the only way to do this in TurboTax is to override line 6b, which means I can't e-file.  Or I could follow TurboTax's instructions and risk getting flagged by the IRS for not reporting my benefits.  Furthermore, if people in this situation follow TurboTax's instructions and fail to report their benefits, there is the potential for that to affect their foreign tax credit calculations on Form 1116.  This could all be solved with one interview question asking whether the customer is in this situation, and zeroing out line 6b if they are.  Thank you for listening.  I'd really like to see this fixed, because it's going to force me to mail in my return this year, or find some other software that handles my taxes correctly.

[AmyC]

Reporting of issues will begin in February for the Community side. I am glad to do that but I do have a suggestion for a work-around but it isn't perfect.  I would recommend putting the income into the SSA portion so that the program determines a taxable amount and then subtract out the taxable amount with an explanation.  The 1040 shows the taxable amount so that can be subtracted like this:

(Using my fake return as an example)

1. In Forms mode, Locate 6b on 1040 to determine the taxable amount that needs to be deducted
2. 
3. Return to Step by Step
4. Select Income & Expenses
5. Locate Less Common Income
6. Miscellaneous Income, 1099-A, 1099-C
7. select START
8. scroll to the bottom to Other Reportable Income.
9. Select START
10. select YES
11. Enter description,  Your country treaty based exemption on SSA
12. then a negative of your taxable SSA equivalent amount, use a minus sign in front (example  -8925)
13. Select Continue

I did say this isn't perfect. It does correctly declare the income and it does remove the taxable part.  You can efile your return at this point. The only rub is that you should file a Form 8833 for a Treaty Based Return Position Disclosure, which would require you to mail in the return with the form 8833.

New this year is the section for Canadian pensions under treaty so that is another option and hopefully that section will be expanded soon.