I pay NYC UBT (unincorporated business tax). Do estimated payments I've made paid go on 1040 Schedule C & where? If not, where do I enter these estimated payments?

[DianeW]

The estimated taxes for both federal and state are entered in the federal portion of the program.  You can use the information below to enter the estimated taxes you paid.

Enter any federal, state or local estimated tax payments you’ve made under Estimates, in the Estimates and Other Taxes Paid section. You'll find this section in Deductions & Credits under either the Federal Taxes tab or the Personal tab, depending on the product. For a shortcut, type “estimates paid” in the search box and use the “Jump to” link.

Your state and local tax payments are automatically transferred to your state return. We’ll also use them to determine whether you’d benefit from itemized deductions, instead of a standard deduction.

Click the images attached to enlarge and view for assistance.

[jjoneser]

I'm not sure this is correct --  the help window in the NYC202S (UBT Return) states, Tax Expense Adjustments for sole proprietors: "These taxes include ... unincorporated business taxes, deducted on your federal schedule C....One example is the New York City Unincorporated Business Tax (UBT)." This leads me to think Schedule C is the correct place to enter the UBT estimated tax payments. If so, where?

[DianeW]

@jjoneser They can be entered in the miscellaneous expenses section.  Here you can label them and deduct the amount.  It appears to be a cost of doing business in NYC.  In this case you would not enter them again in the estimated tax section because this would create a double deduction.

[cabe-franklin]

Exactly right - it's a cost to the business (not the individual) so putting the expense on Schedule C is proper. I have always included UBT (and another NYC local business tax, the MCMT) on the Schedule C line "Taxes and Licenses".  

Note that while the IRS allows you to count these local taxes as a cost to the business, NYS wants you to be more specific about how you claim them. So early in the process of doing the NYS return in TurboTax, there's a place to add those numbers back in.  Then, when you get deeper in the NYS return, you enter in the estimated amounts paid, and you get the credit.

[noodad]

For tax year 2019, TurboTax seems to actually include this as a feature -- see attached from Home & Business download edition. If I fill in this section, TurboTax includes MCMT on the Taxes and Licenses line of Schedule C. It also adds it back in later as a New York addition on my New York return. The interview screens seem to show the same for UBT, so I'm guessing it is treated the same way (I didn't pay any UBT last year so I didn't get to see it in action)

[urbotax_user]

I don't see this deduction from Federal schedule C happening automatically once you complete the NY state modules. Do you have to manually go back to federal and enter the NYC UBT and MCMT taxes? Why wouldn't TurboTax automatically take care of this?

[ThomasM125]

@urbotax_user The taxes would normally only be deductible in the year you pay them, so it would not be correct to deduct them automatically on the federal return without knowing what year they were paid in.